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BOOKKEEPING 

BANKING 


GEORGE  W.  MINER 


GINN  AND  COMPANY 


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Digitized  by  the  Internet  Archive 

in  2007  with  funding  from 

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http://www.archive.org/details/bookkeepingbankiOOminerich 


MOORE  AND  MINER  SERIES 


BOOKKEEPING 


BANKING 


BY 
GEORGE  W.  MINER 


GINN  AND  COMPANY 

BOSTON  •  NEW  YORK  •  CHICAGO  ■  LONDON 


COPYRIGHT,  1902,  1903,  BY 
JOHN  H.  MOORE  and  GEORGE  W.  MINER 


COPYKIGHT,  1913,  BY 
GEORGE  W.  MIXER 


ALL  RIGHTS  RESERVED 
313.1 


GINN  AND  COMPANY  •  PRO- 
PRIETORS •  BOSTON  •  U.S.A. 


PKEFACE 

As  banking  is  a  highly  specialized  subject,  it  is  treated  in  a  separate 
book.  A  reference  to  the  Contents  will  show  the  practical  character 
of  the  work  presented. 

The  revised  edition  has  been  read  in  manuscript  by  George  E.  Allen, 
educational  director  of  the  American  Institute  of  Banking,  and  O.  Howard 
Wolfe,  secretary  of  the  Clearing  House  Section  of  the  American  Bankers' 
Association,  both  of  New  York  City.  The  helpful  and  valuable  suggestions 
which  they  have  given  increase  the  value  of  the  text  both  theoretically 
and  practically. 


iii 


324922 


CONTENTS 


PAGE 

Banks  axd  Banking 1 

Utility  of  Banks .  1 

National  Banks 2 

Powers  of  and  Restrictions  on  National  Banks 6 

National  Bank  Officers  and  Clerks 7 

Opening  Entries  of  a  National  Bank        8 

Trust  Companies 10 

State  Banks 11 

Private  Banks 12 

Bank  Bookkeeping 14 

Work  of  the  Discount  Clerk 15 

Work  of  the  Collection  Clerk 21 

AVork  of  the  Receiving  Teller 27 

Work  of  the  Paying  Teller .     .  31 

.     Work  of  the  Note  Teller 37 

Work  of  the  Correspondence  Clerk 40 

Work  of  the  Individual  Bookkeeper .  46 

Work  of  the  General  Bookkeeper 50 

The  Clearing  House 82 

Letters  of  Credit 91 

Appendix  A .  95 

Notes  on  Forms  of  Record 95 

Reconcilement  Form 97 

Certificate  of  Protest 98 

Notice  of  Protest 99 

Appendix  B 100 

Commercial  Terms  defined 100 

Index 103 


BOOKKEEPING 

BANKS  AND  BANKING 

THE  UTILITY  OF  BANKS 

A  Bank,  in  its  simplest  form,  is  an  institution  for  the  safe-keeping  of 
money ;  but  the  commercial  bank  of  to-day  is  designed  to  render  the 
public  many  varied  and  important  services. 

The  general  utility  of  commercial  banks  may  be  stated  as  follows : 

1.  They  provide  a  place  for  the  safe-keeping  of  money  and  securities. 

2.  They  afford  a  business  man  an  opportunity  to  borrow  money  to 
carry  on  his  enterprises  while  his  capital  is  locked  up  in  merchandise  or 
in  the  hands  of  his  debtors.  The  credit  of  many  mercantile  houses  is 
worth  as  much  to  them  as  the  capital  they  possess.  ' 

3.  They  save  the  transmission  of  money  from  one  place  to  another, 
thus  avoiding  great  risks  and  keeping  money  in  more  active  circulation. 

Settlements  are  effected  by  issuing  to  customers  (a)  bankers'  drafts ; 
(V)  bills  of  exchange ;  (c)  Jetters  of  credit. 

4.  They  facilitate  the  payment  of  bills  by  permitting  money  deposited 
to  be  withdrawn  upon  a  simple  order  called  a  check.  This  check  when 
issued  serves  the  business  man  in  various  ways,  as  follows : 

a.  It  saves  time  in  paying  large  sums  of  money. 

h.  It  obviates  the  risk  that  attends  the  handling  of  money. 

c.  It  constitutes  a  record  of  expenditures  and  furnishes  the  business 
man  convenient  data  from  which  to  make  entries  in  his  books. 

d.  When  the  check  is  canceled  it  serves  the  purpose  of  a  receipt. 

Fully  90%  of  bank  bookkeeping  grows  out  of  the  use  and  collection  of  checks  and 
other  negotiable  instruments. 

5.  By  issuing  letters  of  credit  they  afford  people  who  travel  a  means 
of  securing  money  in  distant  places  without  risk. 

6.  They  afford  excellent  facilities  for  the  collection  of  negotiable 
paper,  —  bills,  notes,  bonds,  coupons,  etc. 

7.  They  are  often  a  source  of  useful  business  information  pertaining 
to  investments  and  other  matters. 

1 


2  BOOKKEEPING 

8.  They  are  a  means  of  organizing  capital. 

9.  They  tend  to  encourage  thrift,  honesty,  and  punctuality. 
Sources  of  a  Bank's  Profits.  —  The  principal  sources  of  a  bank's  profits 

may  be  specified  as  follows : 

1.  Money  earned  for  discounting  business  paper  and  from  lending 
money  on  good  security.  The  available  funds  of  a  bank  for  lending 
purposes  accrue  from 

a.  Amounts  paid  in  by  stockholders. 

h.  Amounts  deposited  by  individuals,  corporations,  bankers,  etc. 

c.  Accumulated  surplus. 

2.  Charges  for  collecting  notes,  drafts,  etc. 

3.  Interest  upon  bonds  deposited  with  the  United  States  Treasurer  to 
secure  circulation,  if  it  is  a  national  bank. 

4.  Fees  for  issuing  drafts,  bills  of  exchange,  etc. 

5.  Profit  on  circulation,  if  it  is  a  national  bank. 

Sources  of  a  Bank's  Expenses.  —  The  prmcipal  sources  of  a  bank's 
expenses  may  be  specified  as  follows  : 

1.  Interest  on  special  deposits. 

2.  Fees  for  collecting  foreign  paper. 

3.  Taxes. 

4.  Salaries  and  various  other  office  expenses. 

Kinds  of  Banks.  —  Banks  may  be  classified  as  follows :  1.  National. 
2.  State.    3.  Private. 

NATIONAL  BANKS 

Distinguishing  Features.  —  Some  of  the  distinguishing  features  of  a 
national  bank  may  be  stated  as  follows : 

1.  It  is  organized  under  the  National  Bank  Act. 

Note.  —  Authentic  information  with  reference  to  the  organization  of  national 
banks  may  be  obtained  upon  appUcation  to  the  Comptroller  of  Currency,  Wash- 
ington, D.C.,  for  a  copy  of  each  of  the  following  pamphlets:  "National  Bank 
Act "  and  "  Instructions  Relative  to  the  Organization  and  Management  of  National 
Banks."  These  pamphlets  contain  valuable  suggestions  for  all  interested  in  the 
business  of  banking.  The  Comptroller  has  also  published  a  valuable  book  entitled 
"  National  Bank  Act  as  Amended." 

2.  It  is  always  an  incorporated  institution. 

3.  It  has  general  authority  to  issue  circulating  notes  as  well  as  to 
conduct  an  ordinary  banking  business. 

4.  It  is  under  the  direction  of  the  Comptroller  of  Currency. 


BANKIKG  3 

5.  Its  general  methods  of  conducting  business  are  consistent  with 
those  of  every  other  national  bank  in  the  United  States. 

6.  Its  stockholders  are  liable  for  twice  the  amount  of  their  subscrip- 
tion; that  is,  in  case  a  bank  fails  and  is  in  need  of  funds  to  meet  its 
liabilities,  a  stockholder  who  owns  $5000  worth  of  stock  is  liable  to 
the  Comptroller  to  the  amount  of  $5000  in  cash  in  addition  to  the  loss 
of  his  stock. 

7.  A  definite  proportion  of  its  stock  must  be  invested  in  United 
States  bonds. 

8.  It  must  have  at  all  times  on  hand  an  available  lawful  money  reserve. 
This  amount  ranges  from  15%  to  25%  of  its  deposits,  depending  upon 
the  city  in  which  the  bank  is  located. 

9.  It  must  form  a  surplus  fund.  Before  making  a  dividend  it  must 
carry  to  its  surplus  fund  one-tenth  of  its  net  profits  since  the  last  pre- 
ceding dividend,  until  the  fund  shall  amount  to  at  least  20%  of  the 
capital  stock,  thereby  establishing  a  reserve  fund  from  which  losses 
may  be  met. 

Organization  of  a  National  Bank.  —  The  successive  steps  required 
to  organize  a  national  bank,  together  with  the  prescribed  forms 
of  articles  of  association  and  by-laws,  are  given  in  the  pamphlets 
referred  to  on  page  2. 

A  summary  of  the  necessary  steps  may  be  given  as  follows : 

1.  There  must  be  at  least  five  persons.  Corporations,  etc.,  cannot 
become  organizers  of  a  national  bank. 

2.  No  national  bank  can  be  organized  with  a  capital  smaller  than 
$25,000.  The  minimum  capital  stock  with  which  a  national  bank  may 
organize  varies  with  the  size  of  the  town  or  city ;  as : 

a.  Minimum  capital  for  banks  organized  in  towns  with  a  population 
of  not  over  3000,  $25,000. 

h.  For  towns  with  a  population  of  not  more  than  6000,  $50,000. 

c.  For  towns  or  cities  with  a  population  of  more  than  6000  and  less 
than  50,000,  $100,000. 

d.  For  towns  or  cities  with  a  population  of  50,000  or  more, 
$200,000. 

3.  A  paper  is  prepared,  which  it  is  expected  people  will  sign,  stating 
the  amount  of  capital  it  is  desired  to  raise  and  the  number  and  value 
of  the  shares.  This  paper  is  circulated  until  the  requisite  amount  is 
subscribed. 

4.  A  name  must  be  selected.  This  may  be  any  name  that  does  not 
conflict  with  one  already  in  use  in  that  particular  town  or  city. 


4  BOOKKEEPING 

5.  Written  application  is  made  to  the  Comptroller  of  Currency  at 
Washington,  giving: 

a.  The  name  and  location  of  the  proposed  bank. 

h.  The  amount  of  the  capital  stock. 

c.  The  names  of  at  least  five  persons  who  are  to  be  stockholders. 

6.  If  the  application  receives  the  Comptroller's  approval,  the  sub- 
scribers unite  in  Articles  of  Association. 

7.  Having  executed  the  articles  of  association,  the  stockholders  then 
execute  a  paper  entitled  Organization  Certificate.  This  certificate  defi- 
nitely specifies : 

a.  The  name  and  location  of  the  association. 
h.  The  capital  stock. 

c.  The  names  and  residences  of  the  stockholders  and  the  number  of 
shares  held  by  each. 

d.  A  general  statement  as  to  why  the  certificate  is  made. 

8.  The  Organization  Certificate  is  then  signed,  acknowledged,  and 
filed  with  the  Comptroller. 

9.  The  stockholders  meet  and  elect  directors.  To  be  eligible  as  a 
director  a  stockholder  must 

a.  Be  a  citizen  of  the  United  States. 

h.  Own  at  least  10  shares  of  the  capital  stock  of  the  bank  if  the  capi- 
tal exceeds  $25,000 ;  if  it  does  not,  he  must  own  at  least  5  shares. 

c.  Three-fourths  of  the  directors  must  have  resided  in  the  state  in 
which  the  association  is  located  for  a  yeai*  or  more  preceding  their  elec- 
tion ;  they  must  also  continue  to  reside  there  while  they  remain  in  office. 

10.  The  directors  then  proceed  to  elect  a  president,  a  vice  president, 
a  cashier,  etc.,  and  call  in  at  least  50^  of  the  capital  stock. 

Note.  —  Fifty  per  cent  of  the  capital  stock  of  a  bank  must  be  paid  in  before  the 
Comptroller  will  give  it  authority  to  commence  business,  and  the  remainder  must 
be  paid  in  in  five  equal  monthly  installments.  Thus  the  entire  capital  stock  must 
be  paid  in  within  six  months  from  the  time  the  bank  is  authorized  to  commence 
business.  In  many  cases  a  surplus  fund  is  created  by  the  payment  of  an  additional 
sum,  this  surplus  fund  serving  to  enhance  the  bank's  credit  and  stability. 

11.  Another  certificate  is  then  made  and  sworn  to  by  a  majority  of 
the  directors.    This  paper  certifies  the  following : 

a.  The  amount  of  paid-in  capital. 

h.  The  name,  residence,  and  number  of  shares  of  each  stockholder. 
c.  That  the  bank  has  complied  with  the  various  requirements  of  the 
National  Bank  Act. 


BANKING  5 

12.  A  portion  of  the  capital  stock  must  then  be  invested  in  United 
States  bonds  and  deposited  with  the  Treasurer  of  the  United  States. 
This  amount  varies  ;  as : 

a.  It  cannot  be  less  than  one-fourth  of  the  capital  stock  if  the  capital 
stock  is  $150,000  or  less. 

h.  If  the  capital  stock  is  more  than  $150,000,  $50,000  in  bonds  must 
be  deposited. 

13.  After  the  Comptroller  has  given  authority  for  the  bank  to  do 
business,  a  code  of  by-laws  is  adopted  for  the  government  of  the  bank. 

14.  If  the  Comptroller  is  assured  that  all  the  requirements  of  the  law 
have  been  executed,  he  will  give  to  the  bank  a  certificate  stating  that  it 
is  authorized  to  commence  business.  This  certificate  must  be  published 
in  the  town  or  the  city  in  which  the  bank  is  located,  for  sixty  days  or 
more  after  it  is  issued. 

Circulating  Notes  of  a  National  Bank.  —  Whether  a  bank  avails  itself 
or  not  of  the  privilege  of  taking  out  circulating  notes,  the  law  requires 
the  above-mentioned  deposit  of  United  States  bonds.  Having  complied 
with  the  law  in  depositing  bonds,  a  national  bank  is  entitled  to  receive 
its  circulating  notes,  equal  in  value  to  the  par  value  of  the  bonds  depos- 
ited, unless  the  bonds  should  be  below  par,  in  which  case  it  may  receive 
circulating  notes  for  only  the  market  value  of  the  bonds. 

A  national  bank  is  not  required  to  take  out  circulating  notes  ;  but 
having  invested  a  part  of  its  capital  m  the  above  manner,  it  is  usually 
desirous  of  utilizing  its  credit  by  getting  as  many  notes  as  the  law  per- 
mits. The  profits  on  these  circulating  notes  consist  of  the  interest  at 
the  current  rate  on  the  amount  invested,  plus  about  1%  or  2%  on  the 
capital  employed. 

Tax  on  Circulation.  —  A  national  bank  is  required  to  pay  to  the  Treas- 
urer of  the  United  States  a  tax  of  l  %  each  half  year  upon  the  average 
amount  of  notes  in  circulation,  secured  by  2%  gold  bonds,  or  Panama 
Canal  bonds.  Circulating  notes  secured  by  all  other  classes  of  bonds 
are  subject  to  a  semiannual  tax  of  |%. 

Interest  on  United  States  Bonds.  —  The  Comptroller  authorizes  the 
payment  of  interest  on  the  bonds  deposited  to  the  bank  depositing  them. 
From  this  income  to  the  bank  no  deduction  is  made  for  taxation,  since 
United  States  bonds  are  exempt  from  taxation. 

Redemption  Fund  with  the  United  States  Treasurer.  —  National  banks 
are  required  to  keep  at  all  times  on  deposit  with  the  Treasurer  of  the 
United   States   5%    of  their  circulation.    This  fund  is  to  be  held  and 


6  BOOKKEEPING 

used  by  the  Treasurer  for  the  redemption  of  worn,  mutilated,  or 
defaced  national  bank  notes  that  may  be  received  from  time  to  time 
and  redeemed  in  sums  of  |1000  or  any  multiple  thereof. 

CORPORATE   POWERS   OF  AND   RESTRICTIONS    ON   NATIONAL   BANKS 

The  Powers  possessed  by  national  banking  associations  may  be  enu- 
merated as  follows : 

1.  To  adopt  and  use  a  corporate  seal. 

2.  To  have  succession  for  twenty  years,  unless  sooner  voluntarily 
dissolved  or  their  franchises  become  forfeited  by  some  violation  of  law. 

3.  To  sue  and  to  be  sued. 

4.  To  elect  and  appoint  directors,  and  by  the  directors  to  appoint  a 
president,  cashier,  etc. 

5.  To  adopt  necessary  by-laws  not  inconsistent  with  law. 

6.  To  make  contracts. 

7.  To  exercise  by  the  directors  such  incidental  powers  as  may  be 
necessary  to  carry  on  the  general  business  of  banking,  such  as  dis- 
counting paper,  receiving  deposits,  loaning  money  on  personal  security, 
buying  and  selling  exchange,  etc.,  obtaining  and  issuing  circulating  notes. 

The  Principal  Restrictions  placed  upon  national  banking  associations 
may  be  enumerated  as  follows : 

1.  National  banks  can  hold  real  estate  on  the  following  conditions: 

a.  Such  as  may  be  needed  for  their  immediate  accommodation  in  the 
transaction  of  business. 

h.  Such  as  may  be  mortgaged  or  conveyed  to  them  in  good  faith  by 
way  of  security  for  debts  previously  contracted. 

c.  Such  as  they  shall  purchase  at  sales  under  judgments,  etc.,  lield  by 
the  association. 

Possession  of  real  estate  under  mortgage,  or  title  and  possession  of 
any  real  estate  purchased  to  secure  debts  due  to  national  banks,  cannot 
be  held  for  a  longer  period  than  five  years. 

2.  No  increase  or  reduction  of  the  capital  stock  of  national  banks  can 
be  made  without  the  approval  of  the  Comptroller.  No  increase  is  valid 
until  the  full  capital  stock  has  been  paid. 

3.  They  are  prohibited  from  loaning  a  person  or  a  firm  an  amount 
exceeding  one-tenth  part  of  their  capital  and  surplus,  providing  the 
amount  loaned  does  not  exceed  30%  of  the  capital.  This  restraint  is 
to  prevent  excessive  loans,  which  always  impair  the  general  usefulness 
of  a  bank. 


BANKING  7 

4.  They  cannot  use  their  own  circulating  notes  to  pay  for  or  increase 
their  capital  stock. 

5.  They  are  expressly  prohibited  from  certifying  a  check  in  excess  of 
a  depositor's  account. 

6.  They  may  not  establish  branches. 

NATIONAL   BANK   OFFICERS   AND  CLERKS 

Officers,  -r-  The  officers  of  a  national  bank  are  chosen  by  the  board  of 
directors  to  superintend  and  direct  its  affairs.    These  are  usually : 

President. 

Vice  President. 

Cashier. 

Assistant  Cashier. 
Clerks  and  Employees.  —  Among  the  clerks  and  employees  of  a  bank 
are :  receiving  teller,  paying  teller,  note  teller,  general  bookkeeper,  indi- 
vidual bookkeeper,  discount  clerk,  collection  clerk,  correspondence  clerk 
or  transit  manager,  runner,  porter,  watchman,  and  such  other  assistants 
as  the  character  and  extent  of  the  business  may  demand. 

The  President  is  the  official  head  of  the  bank.  The  bank  is  dependent 
upon  him  for  its  standing,  and  it  is  therefore  important  that  he  should 
be  a  man  of  honor  and  integrity,  with  a  very  considerable  knowledge  of 
men  and  financial  affairs.  He  should,  by  considerate  action,  by  an  accurate 
knowledge  of  character,  by  a  keen  interest  in  the  movements  of  trade, 
have  under  his  command  all  the  forces  that  tend  to  enhance  his  bank's 
interests.    His  most  important  duties  may  be  specified  as  follows: 

1.  To  preside  at  all  the  meetings  of  the  board  of  directors. 

2.  To  furnish  such  information  concerning  the  bank's  transactions  as 
may  be  desired  by  the  directors. 

3.  To  adopt  a  policy  which  will  govern  the  bank  in  its  operations. 

4.  To  be  influential  in  securing  depositors. 

5.  To  sign  circulating  notes  and  certificates  of  stock. 

6.  To  be  alert  in  watching  the  loans  of  the  bank  to  see  that  they  do 
not  go  beyond  safe  limits. 

The  Vice  President,  in  the  absence  of  the  president,  takes  his  place  and 
performs  the  duties  of  the  office.  In  some  of  the  larger  banks  of  the 
country  this  officer  shares  the  responsibility  of  the  president  and  aids 
in  extending  the  efficiency  of  the  bank's  service. 

The  Cashier  ranks  next  to  the  president  and  the  vice  president,  and  has 
certain  duties  to  perform.    These  duties  are  mentioned  in  the  law  under 


8  BOOKKEEPING 

which  the  bank  exists.     His  most  important  duties  may  be  stated  in  a 
general  way  as  follows : 

1.  He  acts  as  secretary  of  the  board  of  directors  and  keeps  a  record 
of  all  business  transacted  at  their  meetings. 

2.  He  supervises  various  departments  of  work  and  sometimes  employs 
clerks  and  prescribes  their  duties. 

3.  He  conducts  the  correspondence  of  the  bank. 

4.  He  signs  certificates  of  stock  and  circulating  notes. 

5.  He  pays  out  the  bank's  funds  and  borrows  money  in  the  name  of 
the  bank. 

6.  He  indorses  all  paper  that  is  sent  away  for  collection. 

7.  He  signs  the  checks  of  the  bank  and  draws  drafts  on  correspondents. 

8.  He  may  indorse  the  bank's  paper  for  the  purpose  of  securing  loans. 

9.  He  should  aim  to  build  up  the  business  of  the  bank  and  commend 
it  to  public  favor. 

The  Assistant  Cashier  is  employed  only  in  the  larger  banking  institu- 
tions of  the  countiy.  His  official  signature  is  recognized  in  everything 
the  same  as  the  cashier's,  except  in  the  bank's  reports  to  the  Comp- 
troller of  Currency.  He  assists  in  performing  any  of  the  duties  ordi- 
narily devolving  upon  the  cashier. 

PROPOSITIONS  ILLUSTRATING  THE   OPENING  ENTRIES   OF  A 
NATIONAL  BANK 

1.  (a)  A  national  bank  is  organized  with  a  capital  stock  of  $300,000. 
(b)  The  capital  stock  is  fully  paid  in.  (c)  Also  a  surplus  fund  of 
$50,000  is  created  and  paid,  (d)  United  States  bonds  with  a  par  value 
of  $100,000  are  purchased  for  $101,500  cash,  (e)  Circulating  notes  to 
the  extent  of  $100,000  are  received  from  the  Comptroller  of  Currency 
and  duly  signed.  (/)  $5000  is  forwarded  to  the  Treasurer  of  the 
United  States,  as  provided  by  banking  laws,  to  redeem  worn-out  and 
mutilated  circulating  notes,  (g)  Disbursements  ordered  by  the  board 
of  directors  amount  to  $2900. 

Required  the  necessary  opening  entries.  Give  them  in  ordinary 
journal  form. 

To  THE  Student.  —  The  above  proposition  gives  a  statement  of  the  usual 
transactions  resulting  from  the  organization  of  a  national  bank.  If  you  have  the 
successive  steps  of  organization  well  in  mind  you  are  now  ready  to  study  the  follow- 
ing entries.  To  show  the  various  debits  and  credits,  the  entries  are  all  given  in 
journal  form.  After  a  careful  study  of  the  entries  for  proposition  No.  1,  take  a 
sheet  of  journal  paper  and  make  the  entries  for  proposition  No.  2. 


BANKING 


Necessary  Entries 
(a) 


Subscription 

To  Capital  Stock 


Cash 


To  Subscription 


Cash 


To  Surplus  Fund 


(P) 


$300000 


300000 


$300000 


Premium  on  U.S.  Bonds 
U.S.  Bonds  to  secure  Circulation 
To  Cash 

(e) 
Cash 

To  Circulation 

(/) 

Redemption  Fund  with  U.S.  Treasurer 
To  Cash 

(,9) 

Expense 

To  Cash 


50000 


1500 

100000 


100000 


5000 


2900 


300000 


50000 


101500 


100000 


5000 


2900 


2.  (a)  A  national  bank  is  organized  with  a  capital  stock  of  $200,000. 
(5)  The  first  installment  of  50%  of  the  capital  stock  is  duly  paid. 
(<?)  United  States  bonds  with  a  par  value  of  $75,000  are  purchased  for 
$76,000  cash,  (d)  Circulating  notes  are  received  from  the  Comptroller 
of  Currency  for  $75,000  and  duly  signed  by  the  president  and  cashier. 
(e)  One  of  the  stockholders  makes  a  further  payment  of  $20,000  to 
apply  on  the  capital  stock.  (/)  The  necessary  5%  redemption  fund  is 
forwarded  to  the  Treasurer  of  the  United  States  to  redeem  worn  and 
mutilated  circulating  notes,  (g)  Disbursements  ordered  by  the  board 
of  directors  amount  to  $3100. 

Required  the  necessary  opening  entries.  Make  them  in  ordinary 
journal  form. 

To  THE  Instiiuctor.  — The  instructor  will  find  it  a  most  helpful  exercise  to  require 
the  students  to  analyze  fully  each  of  the  entries  called  for  in  the  foregoing  propo- 
sitions. This  will,  at  the  outset,  firmly  fix  in  mind  the  fundamental  principles  in 
the  organization  of  a  national  bank. 


10  BOOKKEEPING 


TRUST   COMPANIES 

Organization Trust  companies  are  in  reality  banking  institutions 

organized  under  and  subject  to  the  laws  of  the  different  states. 

The  Business  of  Trust  Companies  ranks  among  the  important  activities 
of  commerce.  Since  trust  companies  are  state  institutions,  their  man- 
agement and  scope  vary  in  the  different  states.  In  general  the  business 
of  trust  companies  may  be  stated  as  follows  : 

1.  They  receive  money  on  deposit,  subject  to  checks,  the  same  as 
national  banks. 

2.  They  allow  interest  on  special  deposits,  usually  on  amounts  above 
a  specified  sum. 

3.  They  make  loans  in  the  same  careful,  conservative  way  that  is  so 
characteristic  of  national  banks. 

4.  Where  they  have  superseded  state  banks  they  undertake  the 
collection  of  commercial  paper. 

5.  They  are  usually  connected  with  the  clearing  house,  either  directly 
or  through  some  convenient  national  bank. 

6.  They  receive  on  deposit  money,  government  securities,  stocks, 
bonds,  coin,  jewelry,  valuable  papers  and  documents,  evidences  of  debt, 
etc.,  upon  such  terms  and  conditions  as  may  be  agreed  upon. 

7.  They  collect  and  disburse  the  interest  or  income,  if  any,  upon 
property  received  on  deposit  and  at  maturity  coUect  and  disburse  the 
principal  of  such  property  as  produces  interest  or  income. 

8.  They  act  as  trustees  for  widows  and  children. 

9.  They  act  as  agents  in  transferring  stocks  and  bonds. 

10.  They  act  as  agents  for  the  care  and  management  of  invested 
property. 

11.  They  may  be  appointed  by  probate  courts  as  receivers,  executors, 
administrators,  etc. 

12.  They  are  usually  authorized  to  receive  and  hold  moneys  and 
property  in  trust  and  on  deposit  from  courts  of  law  and  equity,  executors, 
assignees,  guardians,  and  trustees  upon  such  terms  and  agreements  as 
may  be  decided  upon. 

Note.  —  In  Massachusetts  and  some  of  tlie  other  states  trust  companies  are 
required  to  maintain  a  reserve  fund  similar  to  the  reserve  fund  of  national  banks, 
and  to  annually  set  aside  10%  of  their  net  earnings  as  a  surplus  or  guaranty  fund 
until  such  fund  amounts  to  25%  of  their  capital  stock.  The  liability  of  the  stock- 
holders is  also  the  same  as  that  of  the  stockholders  of  a  national  bank. 


BANKING  11 

STATE  BANKS 

Organization.  —  State  banks  are  organized  under  and  subject  to  the 
regulations  and  restrictions  of  the  banking  department  of  the  particular 
state  in  which  they  are  located.  The  preliminary  steps  necessary  in  the 
organization  of  a  state  bank  are  quite  similar  to  those  already  outlined 
for  national  banks. 

State  and  National  Banks  compared.  —  State  and  national  banks  may 
be  compared  as  follows : 

1.  Their  management  is  similar. 

2.  Their  scope  is  nearly  the  same. 

3.  They  are  equally  careful  and  conservative  in  the  matter  of  making 
loans. 

4.  In  many  cases  the  protection  afforded  the  creditors  of  state  and 
national  banks  is  equally  strong. 

State  and  National  Banks  contrasted.  —  State  and  national  banks  may 
be  contrasted  as  follows : 

1.  National  banks  are  organized  under  and  subject  to  national  law 
and  authority.  State  banks  are  purely  state  institutions,  organized 
under  and  subject  to  state  law  and  authority. 

2.  National  banks  issue  circulating  notes,  while  state  banks  do  not. 

Note.  —  Prior  to  July  1,  1866,  state  banks  issued  circulating  notes.  On  that 
date  an  amendment  to  the  National  Bank  Act  imposed  a  tax  of  10%  on  these  notes. 
This  tax  proved  too  high  to  allow  any  profit  to  the  state  banks,  and  the  circulating 
notes  were  withdrawn. 

3.  National  banks  are  subject  to  examination  by  persons  appointed  by 
the  National  Government,  while  state  banks  are  examined  by  persons 
appointed  by  the  authority  of  the  given  state. 

4.  National  banks  are  required  to  invest  a  portion  of  their  capital  in 
United  States  bonds.  These  bonds  are  deposited  with  the  Treasurer  of 
the  United  States  to  secure  circulation,  and  are  not  available  to  the 
bank  until  all  of  its  circulation  has  been  redeemed.  As  state  banks  do 
not  issue  circulating  notes,  they  are  not  required  to  purchase  United 
States  bonds. 

If  a  national  bank  should  fail,  its  circulating  notes  would  be  redeemed  by  the 
United  States  government  without  loss  to  the  holder,  but  the  United  States  bonds 
deposited  at  Washington  do  not  afford  security  for  the  payment  of  depositors. 

Note In  Massachusetts  and  a  few  other  states  there  are  no  state  banks,  loan 

and  trust  companies  having  superseded  them.  Authentic  information  respecting  the 
organization  of  state  banks  and  trust  companies  may  be  obtained  by  addressing  the 
proper  Secretary  of  State. 


12  BOOKKEEPING 


PRIVATE   BANKS 

Organization.  —  Private  banks  are  organized  in  the  same  manner  as 
ordinary  partnerships.     They  may  belong  to  an  individual  or  a  firm. 

Functions.  —  The  business  of  private  banks  varies  in  different  locali- 
ties. In  many  cases  they  possess  the  principal  functions  of  national 
banks ;  in  other  cases  their  attention  is  directed  only  to  special  features 
of  banking,  such  as  the  buying  and  selling  of  foreign  exchange,  stocks 
and  bonds,  etc. 

Protection  to  Creditors.  —  In  a  few  states  private  banks  are  restricted 
in  their  operations  by  statute,  in  which  case  they  are  subject  to  the 
inspection  of  state  officials ;  but  usually  their  operations  are  regulated 
and  restricted  only  by  the  common  laws  of  business.  Thus  it  will  be 
seen  that  their  safety  is  dependent  upon  the  integrity  and  financial 
responsibility  of  the  individuals  conducting  them. 

Note —  Private  bankers  are  quite  numerous  in  nearly  all  large  cities,  their  capital 
stock  aggregating,  in  some  instances,  more  than  the  capital  stock  of  national  banks. 
Some  private  bankers  make  a  specialty  of  loaning  their  capital  for  the  promotion  of 
business  enterprises,  taking  for  security  the  stocks  and  bonds  of  tlie  enterprise  pro- 
moted. These  stocks  and  bonds  are  disposed  of  to  customers,  usually  at  a  good 
profit. 

REVIEW   QUESTIONS 

1.  State  the  principal  functions  of  a  commercial  bank.  2.  Briefly  outline  the 
principal  advantages  of  making  payments  by  the  ordinary  bank  check.  3.  A  busi- 
ness man  is  about  to  pay  a  bill  of  $49.75.  He  finds  that  there  is  over  $200  in 
currency  in  his  safe.  He  has  a  good -sized  bank  account.  Which  would  be  the 
more  business-like  way  of  paying  his  bill,  by  check  or  in  currency  ?  Why  ?  4.  Name 
the  principal  sources  of  a  bank's  profits.  5.  From  what  do  the  available  funds  of 
a  bank  for  lending  purposes  accrue?  6.  State  the  principal  sources  of  a  bank's 
expenses.  7.  Name  the  three  general  classes  of  banking  institutions.  8.  Name 
the  chief  distinguishing  features  of  a  national  bank.  9.  Why  are  the  underlying 
principles  of  the  national  banking  system  practically  uniform?  10.  State  the  indi- 
vidual liability  of  the  stockholders  of  a  national  bank.  Illustrate.  11.  What 
lawful  money  must  the  national  banks  in  your  city  have  at  all  times  on  hand? 
12.  Define  the  following:  (a)  surplus  fund;  (b)  United  States  bonds;  (c)  incor- 
porated institution;  (d)  National  Banking  Act.  13.  How  many  persons  are 
required  to  form  a  national  bank  ?  14.  Could  the  number  be  made  up  wholly  or 
in  part  of  fictitious  persons,  as  corporations,  etc.  ?  15.  What  is  the  minimum  capital 
under  which  a  bank  may  organize  in  yoiu-  city  ?  16.  State  the  law  with  reference 
to  the  minimum  capital  required  to  organize  a  national  bank.  17.  A  national 
bank  is  being  organized  in  your  city.     There  are  already  a  number  of  national 


BANKING  13 

banks  doing  business  there.  Could  the  new  bank  adopt  the  name  First  National 
Bank  ?  There  is  no  other  bank  of  that  name  in  your  city.  Give  reasons  for  your 
answer.  18.  What  per  cent  of  the  capital  stock  of  a  national  bank  must  be  paid  in 
before  the  bank  can  be  authorized  to  commence  business?  19.  State  the  necessary 
qualifications  for  a  bank  director.  20.  What  is  generally  the  par  value  of  a  share 
of  national  bank  stock  ?  ^  21.  Suppose  a  national  bank  is  formed  with  a  fully  paid  in 
capital  of  $300,000.  Another  national  bank  is  formed  at  the  same  time  with  a  capital 
stock  of  $200,000,  and  a  surplus  fund  of  $100,000,  both  amounts  fully  paid  in.  Which 
bank  in  your  judgment  is  the  stronger  institution  ?  Why  ?  22.  What  proportion 
of  the  capital  stock  of  a  national  bank  must  be  invested  in  United  States  bonds  ? 
23.  Why  is  th^^re  no  tax  levied  on  United  States  bonds?  24.  Define  the  following: 
(a)  circulating  notes ;  (b)  redemption  fund  with  the  United  States  Treasurer.  25.  Is 
a  bank  bound  to  take  out  circulating  notes  ?  26.  Do  almost  all  national  banks  carry 
circulating  notes?  Why?  27.  What  per  cent  of  the  bonds  deposited  may  the 
circulating  notes  be?  28.  What  is  the  market  value  of  United  States  2%  gold 
bonds  at  the  present  time  ?  29.  Are  circulating  notes  a  source  of  profit  to  national 
banks?  30.  What  is  the  yearly  tax  on  national  bank  notes?  31.  Are  the  United 
States  bonds  deposited  with  the  United  States  Treasurer  a  source  of  income  to  the 
bank  depositing  them  ?  Explain.  32.  For  what  is  Redemption  Fund  with  the  United 
States  Treasurer  created?  How  is  the  amount  of  it  determined?  33.  A  fire  occurs 
in  A's  warehouse.  In  the  office  of  this  warehouse  $500  in  national  bank  bills  are 
burned  to  ashes.  Has  anybody  gained  by  this  destruction  of  bank  notes?  Explain. 
34.  State  the  principal  corporate  powers  of  national  banks.  35.  Under  what  con- 
ditions may  a  national  bank  hold  real  estate  ?  36.  How  can  a  national  bank  increase 
or  diminish  its  capital  ?  37.  Why  are  national  banks  prohibited  from  using  their 
own  circulating  notes  to  pay  for  their  capital  stock  ?  38.  By  whom  are  the  officers 
of  a  national  bank  chosen  ?  39.  Name  the  usual  officers  of  a  national  bank.  40.  Name 
the  usual  clerks  employed  in  the  average  national  bank.  41.  Why  should  the  presi- 
dent of  a  bank  be  a  man  of  extended  experience  and  superior  ability?  42.  State 
the  principal  duties  of  the  average  bank  president.  43.  Where  there  is  a  vice 
president  in  a  bank  what  are  his  duties?  44.  State  the  most  important  duties  of 
the  cashier  of  a  national  bank.  45.  When  there  is  an  assistant  cashier  what  are 
his  duties?  46.  Give  the  initial  opening  entry  for  a  national  bank.  47.  Give  the 
entry  for  the  payment  of  the  capital  stock.  48.  Give  the  entry  for  the  purchase 
of  United  States  bonds  at  a  premium.  49.  Give  the  entry  for  taking  out  circulating 
notes.  50.  Give  the  entry  for  the  funds  remitted  to  the  Treasurer  of  the  United 
States  to  redeem  worn  and  mutilated  circulating  notes. 

1  The  National  Banking  Act  now  requires  the  shares  of  stock  to  have  a  par  value 
of  $100,  in  harmony  with  the  usual  practice  of  joint-stock  companies  throughout  the 
country.  Some  of  the  state  banks,  however,  were  originally  organized  with  shares 
having  a  par  value  of  $50.  Where  these  banks  were  later  changed  into  national  banking 
associations  they  were  given  the  privilege  of  forming  with  shares  of  a  par  value  of  $50. 
This  may  account  for  the  fact  that  some  national  banks  have  shares  whose  par  value  is 
less  than  $100. 


14  BOOKKEEPING 


BANK  BOOKKEEPING 

Object.  —  The  purpose  of  bank  bookkeeping  is  to  set  forth  first,  what 
assets  are  in  the  possession  of  the  bank  ;  and  second,  to  whom  these 
assets  ultimately  belong.  The  form  of  record  is  of  secondary  importance. 
In  a  small  bank,  only  one  set  of  books  is  needed,  but  as  the  bank  grows, 
these  books  are  divided  and  subdivided.  However,  all  the  books  are 
parts  of  the  general  books. 

This  set  is  designed  to  illustrate  in  as  brief  a  way  as  possible  the 
practical  workings  of  an  ordinary  national  bank.  In  order  to  get  at  the 
work  directly,  the  various  books  are  opened  from  statements  showing 
the  condition  of  a  bank  that  is  in  operation.  To  open  a  bank  and  grad- 
ually bring  it  to  a  well-organized  and  paying  institution  would  be  a 
long,  unnecessary  process. 

In  order  to  illustrate  the  closing  entries  in  bank  accounting,  state- 
ments are  made  and  dividends  declared  March  3. 

Books  used.  —  The  books  used  in  this  set  are  :  general  balance  ledger, 
individual  ledger,  discount  register,  discount  tickler,  collection  register, 
collection  tickler,  draft  register,  remittance  register,  certified  check  book, 
general  cash  book,  and  paying  and  receiving  tellers'  check  sheets. 

Auxiliary  Books.  —  The  auxiliary  books  and  records  necessary  in  the 
organization  of  a  national  bank  are  essentially  the  same  as  those  of  any 
other  joint-stock  company  or  corporation.  These  books  may  be  briefly 
referred  to  as  follows : 

1.  Subscription  Book,  made  up  of  a  record  of  the  names  of  the  persons 
subscribing  for  stock  and  the  number  of  shares  wanted. 

2.  Stock  Certificate  Book,  containing  the  receipts  showmg  the  number 
of  shares  delivered  to  each  stockholder. 

3.  Installment  Book,  in  which  are  written  the  names  of  the  stock- 
holders and  the  amount  paid  by  each. 

4.  Transfer  Book,  in  which  is  written  a  history  of  the  certificates 
canceled  and  of  the  new  ones  issued. 

5.  Stock  Ledger,  showing  the  amount  of  capital  stock  and  the  balance 
to  the  credit  of  each  stockholder. 

6.  Minute  Book,  in  which  are  recorded  the  proceedings  of  the  board 
of  directors. 

7.  Dividend  Book,  in  which  are  recorded  the  names  of  the  stock- 
holders, the  number  of  shares  owned,  the  amount  of  their  dividends  at 
various  dividend  periods,  and  receipts  for  the  payment  of  dividends. 


BANKING  15 

Classified  Work.  —  The  work  of  the  set  is  so  classified  that  the  student 
is  made  to  see  the  principal  duties  devolving  upon  the  various  officers 
and  clerks  in  the  daily  routine  of  recording  the  transactions  of  the 
bank.  This  classification  gives  the  student  practice  in  the  performance 
of  the  chief  duties  of : 

1.  Paying  teller.  5.  Collection  clerk. 

2.  Receiving  teller.  6.  Correspondence  or  transit  clerk. 

3.  Note  teller.  7.  Individual  bookkeeper. 

4.  Discount  clerk.  8.  General  bookkeeper. 

9.  Cashier. 

General  Directions  and  Suggestions.  —  In  this  set  Commercial  National 
Bank  is  the  name  under  which  the  banking  association  is  incorporated. 
The  location  is  Boston,  Mass. 

The  student  is  about  to  familiarize  himself  with  the  details  of  an 
ordinary  national  banking  institution,  and  he  will  be  carefully  instructed 
as  to  the  duties  of  the  various  officers  and  clerks  by : 

1.  Being  allowed  to  examine  carefully  the  present  condition  of  tlie 
books  used. 

2.  Being  specifically  instructed  as  to  the  powers,  responsibilities,  and 
general  duties  of  the  various  officers  and  clerks. 

3.  Being  allowed  to  make  further  entries  in  the  various  books  during 
the  progress  of  each  day's  business. 

WORK   OF  THE   DISCOUNT   CLERK 

The  records  of  the  discount  clerk  are  to  be  examined  first.  These 
records  are  found  principally  in  the  discount  register  and  discount  tickler. 

The  Discount  Register  contains  a  full  record  of  all  paper  accepted  for 
discount.  It  is  the  bill  book  of  the  bank  and  gives,  in  addition  to  the 
information  ordinarily  contained  in  a  common  bill  book,  the  amount  of 
discount  and  collection  and  exchange  charged,  the  proceeds  of  the 
paper,  etc.  The  illustration  on  pages  16  and  17  is  self-explanatory. 
It  shows  a  day's  records,  with  the  necessary  check  marks,  etc. 

No  record  is  made  in  the  discount  register  at  the  maturity  of  paper; 
therefore  it  will  not  be  necessary  for  the  student  to  enter  the  discounted 
paper  on  hand  in  the  discount  register.     (See  page  95.) 

The  Discount  Tickler  contains  a  classified  record,  with  reference  to 
maturity,  of  all  the  paper  entered  in  the  discount  register.  These 
records  are  made  to  "tickle,"  or  remind,  the  discount  clerk  to  have 
paper  presented  for  payment  at  the  proper  time. 


16 


r>OOKKEEPING 


Discount 

DATE  DIS- 
COUNTED 

FOR  WHOM 
DISCOUNTED 

MAKER  OR  PAYER 

INDORSER 

WHERE  PAYABLE 

NUM- 
BER 

DATE  OF 
PAPER 

1^- 
June 

20 
20 
20 
20 

D.  E.  Avery 
Powers  &  Sprague 

E.  V.  Buckley  &  Son 
J.  H.  Crandall 
Dodge  Bros, 

Wilson  &  Son 
C.  Rear  don  &  Co. 
W.  O.  Radcliife 
Frey  &  Mason 
Rogers,  Peet  &  Co. 

Cook  Bros. 
Bates  Bros. 

Alliance  Nat'l,  City 
Farmers  Bank,  Chicago 
First  Nat'l,  Syracuse 
Our  Bank 
Traders  Nat'l,  Phila. 

230 
231 
252 
233 
234 

ID- 
Apr. 
May 
Apr. 

June 

20 

1 

1 

15 

15 

As  soon  as  paper  is  accepted  for  discount  it  is  entered  in  the  discount 
register,  the  due  date  is  written  across  its  face  in  red  ink,  and  it  is 
recorded  in  the  discount  tickler  under  the  proper  number  and  date. 
After  these  records  have  been  completed  the  notes  are  carefully  checked 
back  from  the  tickler. 

The  tickler  is  generally  ruled  in  sections  for  each  day  in  the  year. 
At  the  top  of  each  section  is  printed  the  day  and  date.  The  Remarks 
column  is  used  for  noting  irregularities  in  payment,  etc. 


Monday, 

NO. 

PAYER 

WHERE  PAYABLE 

TO  WHOM  SENT 

800 

C;  W.  Hall  &  Co. 

Our  Bank 

821 

Morton  &  Davis 

First  National  Bank,  Buffalo 

Traders  National,  Buffalo 

827 

C.  W.  Carey 

Allston  &  Co.,  Bankers,  City 

Tuesday, 

782 

Raymond  Bros. 

Union  Trust  Co.,  City 

790 

Stickney,Poor&Co. 

National  City  Bank,  Brooklyn 

Chemical  National  Bank,  N.Y. 

765 

F.  E.  Sherman 

Our  Bank 

778 

De  Young  Bros. 

Citizens  Bank,  Troy 

Farmers  Bank,  Albany 

Paper  to  be  entered  in  the  Discount  Tickler.  —  The  following  dis- 
counted paper  is  now  in  the  possession  of  the  bank  and  is  shown  by 
the  uncanceled  records  in  the  discount  tickler.  Take  your  discount  tic- 
kler and  enter  this  paper,  being  guided  by  the  accompanying  model. 


BANKING 


17 


Register 


TIME 

WHEN 
DUE 

TERM 
OF  DIS- 
COUNT 

RATE 
OF  DIS- 
COUNT 

AMOUNT 
OF  PAPER 

INTEREST 

AND 
DISCOUNT 

COLLECTION 

AND 
EXCHANGE 

PROCEEDS 

TO  BE 
CREDITED 

TIC- 
KLER 
CK. 

REMARKS 

3  mo. 
3  mo. 
90  da. 
90  da. 
30  da. 

19- 
July 
Aug. 
June 
July 

20 
1 
30 
14 
15 

30  da. 
42  da. 
10  da. 

24  da. 

25  da. 

6% 
6% 
6% 
6% 
6% 

2000 
1500 
900 
6000 
3000 

10 
10 
1 
24 
12 

50 
50 

50 

3 

88 
75 

1990 
1487 
898 
5976 
2983 

62 
50 

75 

Issued  Cashier's  Ck. 

13400 

58 

50 

5 

63 

v/ 
13335 

87 

Write  dates  in  the  discount  tickler  as  follows :  March  1,  2,  3,  4,  5, 
6,  9,  11,  12,  16,  25,  26,  29,  31,  and  April  1. 

Do  not  show  any  totals  at  this  time,  as  the  entries  in  the  general 
debit  and  credit  books  will  not  be  made  until  the  general  bookkeeper's 
work  is  given. 

Note.  —  In  this  work  all  paper  maturing  on  Sundays  or  legal  holidays  should  be 
entered  in  the  ticklers  under  the  date  of  the  first  business  day  following.  The 
statutes  of  the  different  states,  however,  are  not  uniform  on  this  point. 


Feb.  15,  19- 


Tickler 


BY  WHOM  DISCOUNTED 

AMOUNT  TO  BE 
COLLECTED 

CK. 

REMARKS 

Decker  Bros. 

D.  E.  Avery 

E.  L.  Howard 

7500 

1500 
9000 

Cash 

Charged  to  Traders,  Buffalo 

Certified,  Allston  &  Co.,  Bankers 

18000 

Feb.  16.  19- 


W.  I.  Pratt 

£500 

V 

Protested.     Fees,  $1.75.     Charged  to  Pratt 

J.  0.  Baker 

3000 

V 

Charged  to  C.  N.  B.,  New  York 

Powers  &  Sprague 

4500 

V 

Charged  to  F.  E.  Sherman 

2000 

V 

Charged  to  Fanners,  Albany 

12000 

V 

Paper  maturing  Monday,  March  1 


No.  889.    Note  of  W.  I.  Pratt,  at  30  days  from  Jan.  30,  discounted 
for  Decker  Bros.,  payable  at  our  bank,  for  §2750. 


^18  BOOKKEEPING 

No.  866.  Note  of  B.  M.  Vosburg  &  Co.,  at  two  months  from 
Jan.  1,  discounted  for  Mace,  Gilmore  &  Co.,  payable  at  Traders  National 
Bank,  Buffalo,  for  $7500.     Sent  to  Traders  National  Bank. 

No.  842.  Note  of  Gregory  Mfg.  Co.,  at  three  months  from  Dec.  1  last, 
discounted  for  Spencer,  Mead  &  Co.,  payable  at  Third  National  Bank, 
Buffalo,  for  $5000.     Sent  to  Traders  National  Bank,  Buffalo. 

No.  893.  Note  of  Dillon  Bros.,  at  30  days  from  Jan.  30,  discounted 
for  D.  B.  Roberts,  payable  at  Merchants  National  Bank,  City,  for  $7550. 

No.  901.  Note  of  D.  S.  Davenport,  at  10  days  from  Feb.  19,  dis- 
counted for  E.  L.  Howard,  payable  at  Eliot  National  Bank,  City,  for 
$9500. 

Paper  maturing  Tuesday,  March  2 

No.  902.  Note  of  Novelty  Mfg.  Co.,  at  10  days  from  Feb.  20,  dis- 
counted for  Fernald,  Son  &  Co.,  payable  at  Alliance  National  Bank, 
Springfield,  Mass.,  for  $18,500.     Sent  to  Alliance  National  Bank. 

No.  869.  Note  of  F.  M.  Elery  &  Son,  at  two  months  from  Jan.  2, 
discounted  for  Thomas  Bennett  &  Co.,  payable  at  Union  Bank,  Worces- 
ter, for  $32,400.     Sent  to  Alliance  National  Bank,  Springfield. 

No.  868.  Note  of  Daniels  Novelty  Co.,  at  60  days  from  Jan.  1, 
discounted  for  Mace,  Gilmore  &  Co.,  payable  at  our  bank,  for  $33,210. 

No.  895.  Note  of  Powers  &  Lawler,  at  15  days  from  Feb.  15,  dis- 
counted for  W.  I.  Pratt,  payable  at  Farmers  Bank,  Albany,  for 
$28,890.    Sent  to  Farmers  National  Bank,  Albany. 

No.  867.  Note  of  Baush  &  Lomb,  at  60  days  from  Jan.  1,  discounted 
for  C.  E.  Selover  &  Co.,  indorsed  by  Anderson  &  Page,  payable  at  our 
bank,  for  $16,500. 

Paper  maturing  Wednesday,  March  3 

No.  897.  Note  of  I.  M.  Lyons,  at  15  days  from  Feb.  16,  discounted 
for  D.  E.  Avery,  payable  at  our  bank,  for  $29,900. 

No.  882.  Note  of  Kennedy  Soap  Co.,  at  20  days  from  Feb.  11, 
discounted  for  J.  H.  Crandall,  payable  at  Union  Trust  Co.,  City,  for 
$24,750. 

No.  883.  Note  of  Cobb,  Bates  &  Co.,  at  20  days  from  Feb.  11, 
discounted  for  Burgess  &  Co.,  indorsed  by  Ginn  &  Co.,  payable  at 
Colonial  National  Bank,  City,  for  $12,250. 

No.  875.  Note  of  Cobb  &  Co.,  at  30  days  from  Feb.  1,  discounted 
for  George  D.  Hatch  &  Co.,  payable  at  Shoe  and  Leather  Bank,  City, 
for  $25,625. 


BANKING  19 

Paper  maturing  Thursday,  March  4 

No.  884.  Note  of  W.  E.  Denman,  at  20  days  from  Feb.  12,  dis- 
counted for  C.  E.  Denison,  payable  at  Chemical  National  Bank,  New 
York,  for  |37,000.     Sent  to  Chemical  National  Bank. 

No.  906.  Note  of  David  W.  Parker,  at  15  days  from  Feb.  17,  dis- 
counted for  C.  E.  Denison,  payable  at  our  bank,  for  130,000. 

No.  907.  Note  of  Marsh  &  Grant,  at  15  days  from  Feb.  17,  dis- 
counted for  Thomas  Bennett  &  Co.,  payable  at  our  bank,  for  $17,295. 

No.  876.  Note  of  G.  S.  Murray,  at  30  days  from  Feb.  2,  discounted 
for  Decker  Bros.,  payable  at  Chemical  National  Bank,  New  York,  for 
112,460.     Sent  to  Chemical  National  Bank. 

No.  857.  Note  of  Fred  M.  Everitt  &  Co.,  at  60  days  from  Jan.  3, 
discounted  for  Fernald,  Son  &  Co.,  payable  at  Farmers  Bank,  Albany, 
for  116,792.     Sent  to  Farmers  Bank. 

Paper  maturing  Friday,  March  5 

No.  908.  Note  of  Stanley  Carriage  Co.,  at  10  days  from  Feb.  23, 
discounted  for  J.  H.  Crandall,  payable  at  Union  Trust  Co.,  City,  for 
$23,680. 

Paper  maturing  Saturday,  March  6 

No.  910.  Note  of  Jamison,  Baker  &  Co.,  at  10  days  from  Feb.  24, 
discounted  for  Freeman,  Austin  &  Co.,  payable  at  Park  Square 
National  Bank,  City,  for  $31,720. 

No.  890.  Note  of  Fowler  Mfg.  Co.,  at  30  days  from  Feb.  4,  dis- 
counted for  C.  E.  Selover  &  Co.,  payable  at  Chemical  National  Bank, 
New  York,  for  $31,750.     Sent  to  Chemical  National  Bank. 

Paper  maturing  Tuesday,  March  9 

No.  844.  Note  of  C.  B.  Conroy  &  Co.,  at  three  months  from  Dec.  9 
last,  discounted  for  Lane,  Rowell  &  Co.,  payable  at  our  bank,  for 
$25,750. 

Paper  maturing  Friday,  March  12 

No.  847.  Note  of  D.  D.  Eldred,  at  three  months  from  Dec.  12  last, 
discounted  for  F.  E.  Sherman,  payable  at  our  bank,  for  $15,950.50. 

Present  the  discount  tickler  to  your  teacher  for  approval. 
The  Duties  of  the  Discount  Clerk  may  be  specified  as  follows : 

1.  He  takes  charge  of  the  bills  receivable  accepted  for  discount. 

2.  He  keeps  the  records  of  the  loaning  department  of  the  bank. 


20 


BOOKKEEPmG 


Transactions  for  the  Discount  Clerk,  March  1 

The  following  paper  has  been  offered  and  accepted  for  discount 
to-day.  As  discount  clerk  make  the  proper  records  in  the  discount 
register.  Examine  the  model  for  discount  register  given  on  pages 
16  and  17.     Consult  your  instructor  when  in  doubt  on  any  point. 

In  the  following  memoranda  of  transactions,  where  the  paper  contains  no 
other  indorsement  than  that  of  the  holder,  the  indorser  is  not  stated,  and 
the  column  Indorser  in  the  discount  register  may  be  left  blank. 

Unless  otherwise  stated,  discount  is  computed  at  6%  per  annum. 

No.  920.  Note  of  Wells,  Osborn  &  Co.,  at  30  days  from  March  1, 
discounted  for  Mace,  Gilmore  &  Co.,  payable  at  Old  Colony  National 
Bank,  City,  for  $2960.     Discount,  $14.80.     Proceeds  credited. 

No.  921.  Note  of  Baker  &  Small,  at  30  days  from  Feb.  23,  indorsed 
by  King  &  Chappell,  discounted  for  Decker  Bros.,  payable  at  First 
National  Bank,  Worcester,  for  17500.  Discount,  f30.  Collection  and 
exchange,  17.50.     Proceeds  credited. 

No.  922.  Note  of  Wyckoff  &  Co.,  at  30  days  from  March  1,  dis- 
counted for  W.  I.  Pratt,  payable  at  Old  Colony  National  Bank,  City, 
for  11500.     Discount,  $7.50.     Proceeds  credited. 

No.  923.  Note  of  C.  A.  Seaver  &  Co.,  at  15  days  from  March  1,  indorsed 
by  Boswell,  Mason  &  Co.,  discounted  for  Wyckoff,  Seamans  &  Benedict, 
payable  at  our  bank,  for  $10,000.     Discount,  $25.     Proceeds  credited. 

No.  924.  Note  of  F.  E.  Harris,  at  10  days  from  March  1,  discounted 
for  J.  H.  Crandall,  payable  at  Farmers  Bank,  Albany,  for  $9000.  Dis- 
count, $15.     Collection  and  exchange,  $9.50. 


Collection 


WHEN  LEFT 

NO. 

PAYER 

INDORSER 

WHERE  PAYABLE 

Feb. 

16 

610 

C.  W.  Young 

Union  Trust  Co.,  City 

16 

611 

E.  0.  Frey  &  Co. 

.' 

Traders  Nat'l,  Bulfalo 

16 

612 

Geo.  A.  Ward 

Wood  &  Garson 

Park  Nat'l,  Providence 

16 

613 

F.  E.  Brown 

Scranton  &  Co. 

Our  Bank 

16 

614 

Mason,  Quigley  &  Co. 

Our  Bank 

16 

615 

Reardon  &  Ellis 

Rowland  &  Haviland 

Alliance  Nat'l,  Springfield 

16 

616 

Novelty  Mfg.  Co. 

Our  Bank 

16 

617 

Ellis  Soap  Co. 

Robert  Simpson 

Monroe  Bank,  City 

17 

618 

C.  H,  Bryant 

Our  Bank 

BANKING 


21 


As  discount  clerk  the  student  should  now  proceed  as  follows : 

1.  Rule  and  foot  the  discount  register.     Examine  the  model  given. 

2.  Prove  the  footings.  The  total  of  the  Proceeds  column  plus  the 
total  of  the  Discount  and  Collection  and  Exchange  columns  should 
equal  the  total  of  the  Amount  column. 

3.  Post  the  entries  from  the  discount  register  to  the  discount  tickler. 
Leave  the  columns  Where  Sent  and  Remarks  in  the  discount  tickler  blank 
for  the  time  being.     These  will  be  filled  out  later  as  the  work  progresses. 

Submit  the  discount  register  and  discount  tickler  to  your  instructor 
for  approval. 

The  Auxiliary  Books  kept  by  the  discount  clerk  are  of  significant 
importance  in  a  bank,  but  they  are  so  simple  in  character  and  so  self- 
explanatory  that  it  is  thought  best  not  to  attempt  to  use  them  in 
these  records.     They  are  : 

1.  The  Offering  Book^  containing  information  with  reference  to  the 
parties  applying  for  loans. 

2.  The  Discount  Ledger^  contaiuing  a  record  of  the  amount  of  paper 
discounted  for  each  customer. 

3.  The  Customers'  Bill  Book,  containing  a  detailed  statement  of  the 
various  papers  offered  for  discount  by  the  customers  of  the  bank. 

WORK  OF  THE  COLLECTION  CLERK 

The  records  of  the  collection  clerk  are  now  to  be  examined.  They 
are  found  principally  in  the  collection  register  and  collection  tickler. 

The  Collection  Register  contains  a  record  of  all  commercial  paper 
received  by  the  bank  for  collection.     Many  banks  keep  two  collection 


Register 


DATE  OF 

DRAFT 

OR  NOTE 

TIME 

WHEN  DUE 

FOR  WHOM  COLLECTED 

AMOUNT 

TO  BE 

COLLECTED 

CK. 

REMARKS 

Feb. 

9 

2  mo. 

April 

9 

Fields  Milling  Co. 

1650 

\/ 

2 

3  mo. 

May 

2 

Charles  J.  Kennedy 

2500 

v/ 

2 

60  da. 

April 

3 

E.  V.  Buclcley  &  Son 

10000 

V 

Jan. 

29 

3  mo. 

29 

Wyckoff ,  Seamans  &  Benedict 

75 

20 

V 

IG 

4  mo. 

May 

16 

F.  E.  Sherman 

1150 

22 

V 

21 

4  mo. 

21 

Freeman,  Austin  &  Co. 

95 

GO 

V 

Feb. 

2 

GO  da. 

April 

3 

C.  E.  Denison 

1250 

V 

3 

30  da. 

March 

5 

D.  E.  Avery 

9500 

v/ 

7 

2  mo. 

April 

7 

Alliance  Bank,  Springfield 

215 

90 

v^ 

9'-) 


BOOKKEEPING 


registers,  one  for  city  collections  and  one  for  collections  payable  out  of 
town.  The  paper  entered  in  the  collection  register  is  generally  num- 
bered consecutively.  The  foregoing  model  is  self-explanatory.  The 
column  Indorser  need  not  be  filled  out  except  when  there  is  an  indorser 
other  than  the  owner  of  the  paper.  If  any  time  paper  is  interest-bearing, 
the  amount  of  the  interest  should  be  added  to  the  face  of  the  paper  before 
it  is  recorded  in  the  collection  register. 

Since  no  record  is  needed  in  the  collection  register  at  the  maturity 
of  paper,  it  will  not  be  necessary  for  the  student  to  enter  the  collection 
paper  on  hand  in  the  collection  register. 

The  Collection  Tickler.  —  As  soon  as  paper  is  properly  recorded  in 
the  collection  register  it  is  classified  in  the  collection  tickler  under  its 
date  of  maturity.  The  object  of  the  collection  tickler  is  to  remind  the 
bank  clerks  of  the  maturity  of  paper  leceived  for  collection. 

The  following  collection  paper  is  now  in  the  possession  of  the 
bank  and  is  shown  by  the  uncanceled  records  in  the  collection  tickler. 
Record  it  in  your  collection  tickler.     (See  page  95.) 


Collection 

Monday, 

NO. 

PAYER 

WHERE  PAYABLE 

TO  WHOM  SENT 

590 
592 
593 
595 
596 

C.  W.  Gray 

L.  0.  Sweetland 
N.  P.  Pond 

D.  E.  Anderson  &  Co. 
Frey,  Miller  &  Co. 

Our  Bank 

Alliance  Nat'l,  Springfield 
Traders  Nat'l,  Buffalo 
Union  Trust  Co.,  City 
Park  Nat'l,  City 

Alliance  Nat'l,  Springfield 
Fourth  Nat'l,  Buffalo 

Tuesday, 

572 

D.  O.  Dale  &  Co. 

First  Nat'l,  Albany 

Farmers  Bank,  Albany 

581 

Covey  &  Dudley  Co. 

Traders  Nat'l,  Albany 

Farmers  Bank,  Albany 

598 

Paine  Cutlery  Co. 

Union  Bank,  Worcester 

Alliance  Nat'l,  Springfield 

601 

F.  C.  Rowland 

Our  Bank 

602 

C.  E.  Reardon 

Suffolk  Nat'l,  City 

60C 

Sampson  &  Newell 

Mechanics  Nat'l,  Springfield 

Alliance  Nat'l,  Springfield 

Write  dates  in  the  collection  tickler  as  follows :  Feb.  25,  2G,  March 
1,  2,  3,  4,  5,  6,  9,  10,  18,  27,  31,  April  1  and  2.  Write  March  3 
twice. 


BANKING 


23 


Collections  maturing  Thursday,  Feb.  25 

No.  650.  Note  signed  by  Wentworth  &  Son,  dated  Nov.  25  last,  at 
three  months,  indorsed  by  J.  K.  Miner,  payable  at  Albany,  N.Y.,  for 
i725.     Sent  to  Farmers  Bank.     To  be  collected  for  E.  V.  Buckley  &  Son. 

No.  702.  Note  signed  by  Daly  Bros.,  dated  Dec.  25,  at  two  months, 
payable  at  Albany,  N.Y.,  for  |1200.  Sent  to  Farmers  Bank.  To  be 
collected  for  J.  O.  Baker. 

No.  723.  ,Draft  dated  Jan.  25,  at  one  month  from  date,  on  F.  W. 
Edwards  &  Son,  payable  at  Fourth  National  Bank,  Brooklyn,  for 
$1005.25.  Sent  to  Chemical  National  Bank,  New  York.  To  be  col- 
lected for  Powers  &  Sprague. 

Collections  maturing  Friday,  Feb.  26 

No.  726.  Note  signed  by  E.  B.  Munroe,  dated  Jan.  27,  at  30  days, 
payable  at  Providence,  for  $4900.  Sent  to  Chase  National  Bank,  Provi- 
dence.    To  be  collected  for  Decker  Bros. 


Tickler 


Feb.  15,  19- 


FOR  WHOM  COLLECTED 

AMOUNTTOBE 
COLLECTED 

WHEN  AND  HOW  DISPOSED  OF 

Spencer,  Mead  &  Co. 
Mace,  Gilmore  &  Co. 
W.  I.  Pratt 

Alliance  Nat'l,  Springfield 
Chase  Nat'l,  Providence 

9000 
752 
1750 
7200 
1625 

50 
90 

Paid,  2/15. 

Chgd.  Alliance  Nat'l,  2/19.    Our  coll.,  750;  bank's  coll.,  $1 
Chgd.  Fourth  Nat'l,  2/20.    Our  coll.,  1^1.75;  bank's  coll.,  !g2.25 
Certified,  2/15,  Union  Trust  Co.    Our  coll.,  $7.20 
Certified,  2/15,  P.  N.  B.    Our  coll.,  $1.65 

Feb.  16.  19. 


W.  I.  Pratt 

2100 

Chgd.  Farmers  Bank,  2/22.    Our  coll.,  $2.10;  bank's  coll.,  $4 

D.  E.  Avery 

1650 

Chgd.  Farmers  Bank,  2/22.    Our  coll.,  $1.65;  bank's  coll.,  $3 

C.  E.  Denison 

662 

90 

Chgd.  Alliance  Nat'l,  2/21.    Our  coll.,  m<p\  bank's  coll.,  $1 

Ninth  Nat'l,  Hartford 

1725 

90 

Paid,  2/16.    Our  coll.,  $2 

Chase  Nat'l,  Providence 

2100 

Certified,  2/16,  S.  B.    Our  coll.,  $2.75 

C.  E.  Selover  &  Co. 

7500 

Chgd.  Alliance  Nat'l.    Our  coll. ,  $7.50;  bank's  coll. ,  $12 

No.  742.  Draft  dated  Jan.  26,  at  one  month  from  date,  on  B.  W. 
Mills,  payable  at  Providence,  for  15200.  Sent  to  Chase  National  Bank, 
Providence.     To  be  collected  for  Wyckoff,  Seamans  &  Benedict. 


24  BOOKKEEPING 

No.  743.  Note  signed  by  Samuel  Powell  &  Co.,  dated  Dec.  28  last, 
at  60  days,  payable  at  Bank  of  Commerce,  Baltimore,  for  81250.  Sent 
to  Bank  of  Commerce,  Baltimore.  To  be  collected  for  Freeman,  Austin 
&Co. 

Collections  maturing  Monday,  March  1 

No.  744.  Note  signed  by  E.  O.  Hamilton,  payable  60  days  after 
Dec.  31  last,  at  our  bank,  for  ^1650.25.  To  be  collected  for  Freeman, 
Austin  &  Co. 

No.  752.  Note  signed  by  J.  H.  Moore,  payable  30  days  after  Jan.  30, 
at  Springfield,  Mass.,  for  8722.50.  Sent  to  Alliance  National  Bank, 
Springfield.     To  be  collected  for  Traders  National  Bank,  Buffalo. 

No.  755.  Draft  dated  Feb.  1,  at  one  month  from  date,  on  E.  L. 
Howard,  payable  at  our  bank,  for  85000.  To  be  collected  for  Wyckoff, 
Seamans  &  Benedict. 

Collections  maturing  Tuesday,  March  2 

No.  757.  Note  signed  by  W.  E.  Patten,  payable  30  days  after  Jan.  31, 
at  Buffalo,  for  81750.  Sent  to  Traders  National  Bank.  To  be  collected 
for  Alliance  National  Bank,  Springfield. 

No.  756.  Note  signed  by  Charles  H.  Thurber  &  Co.,  payable  20  days 
after  Feb.  10,  at  Union  Trust  Co.,  City,  for  879.23.  To  be  collected 
for  Farmers  Bank,  Albany. 

No.  760.  Note  of  G.  A.  Churchill,  payable  30  days  after  Jan.  31,  at 
Poughkeepsie,  N.Y.,  for  873.92.  Sent  to  Chemical  National  Bank.  To 
be  collected  for  Chase  National  Bank,  Providence. 

Collections  maturing  Wednesday,  March  3 

No.  764.  Note  signed  by  J.  M.  Goulding,  payable  30  days  after  Feb.  1, 
at  Springfield,  for  8125.72.  Sent  to  Alliance  National  Bank,  Springfield. 
To  be  collected  for  Chase  National  Bank,  Providence. 

No.  765.  Draft  dated  Feb.  3,  at  one  month  from  date,  on  Rogers  & 
Williams,  indorsed  by  Wilder  &  Fields,  payable  at  our  bank,  for  8652.01. 
To  be  collected  for  Mace,  Gilmore  &  Co. 

Collections  maturing  Thursday,  March  4 

No.  766.  Draft  dated  Jan.  4,  at  two  months  from  date,  on  R.  B. 
Elder,  payable  at  Bunker  Hill  National  Bank,  City,  for  8700.  To  be 
collected  for  C.  E.  Selover  &  Co. 

No.  767.  Note  signed  by  S.  C.  Williams,  indorsed  by  DeWitt  &  Bliss, 
payable  60  days  after  Jan.  3,  at  Rochester,  N.Y.,  for  81600.     Sent  to 


BANKING  25 

Traders  National  Bank,  Buffalo.  To  be  collected  for  C.  E.  Selover 
&  Co. 

Collections  maturing  Friday,  March  5 

No.  770.  Note  signed  by  F.  W.  Humphrey,  payable  30  days  after 
Feb.  3,  at  our  bank,  for  $325.     To  be  collected  for  Wilder  &  Fields. 

No.  771.  Note  signed  by  J.  Kennard,  payable  30  days  after  Feb.  3, 
at  Bunker  Hill  National  Bank,  for  |3000.  To  be  collected  for  Traders 
National  Bank,  Buffalo. 

No.  774.  'Note  signed  by  James  H.  Beatty,  payable  60  days  after 
Jan.  4,  at  Union  Trust  Co.,  City,  for  12500.  To  be  collected  for 
Chemical  National  Bank,  New  York. 

Collections  maturing  Saturday,  March  6 

No.  778.  Note  signed  by  John  Wanamaker,  indorsed  by  Wilder  & 
Fields,  payable  60  days  after  Jan.  5,  at  Union  Trust  Co.,  City,  for  $1200. 
To  be  collected  for  Farmers  National  Bank,  Albany. 

No.  779.  Note  signed  by  Cloud  &  King,  indorsed  by  Elder  &  Samp- 
son, payable  60  days  after  Jan.  5,  at  Union  Trust  Co.,  City,  for  $1000.50. 
To  be  collected  for  Chase  National  Bank,  Providence. 

The  Duties  of  the  Collection  Clerk  may  be  specified  as  follows : 

1.  He  takes  charge  of  paper  received  by  the  bank  for  collection. 

2.  He  makes  the  proper  entries  for  collection  paper  in  the  original 
books  of  record. 

Rates  of  Collection The  collections  made  by  a  bank  constitute  an 

important  part  of  its  business.  Formerly  this  feature  of  banking  was 
very  profitable,  the  lowest  charge  in  many  banks  for  collecting  paper 
payable  out  of  town  being  i%,  while  a  charge  of  three  or  four  times 
this  was  not  unusual.  Now  these  charges  vary,  ranging  from  -f^%  to 
\%;  but  the  rates  are  by  no  meaiis  uniform.  They  depend  upon  a 
number  of  things,  among  which  may  be  mentioned  the  following : 

1.  Trade  movements;  e.g.,  during  the  late  fall  months  New  York 
is  sending  a  great  many  checks  to  states  in  the  Mississippi  Valley 
in  payment  for  shipments  of  wheat;  hence  the  states  in  this  section 
are  anxious  at  such  times  to  get  collection  items  from  New  York  and 
near-by  cities,  to  reduce  their  balances  with  New  York  banks,  and 
they  make  collections  with  little  or  no  charge.  Later  on  the  condi- 
tions are  practically  reversed,  and  the  collection  rate  in  the  Middle 
West  for  items  from  New  York  and  adjoining  cities  runs  as  high 
as  \%. 


26  BOOKKEEPING 

2.  Various  arrangements  of  banks  with  one  another  ;  e.g.^  some  collect- 
ing banks  agree  to  make  remittances  regularly  at  par,  the  use  of  the 
money  so  collected  being  considered  as  an  offset  to  the  trouble  of  col- 
lecting ;  other  banks  sometimes  agree  to  remit  at  stated  intervals  at  a 
stipulated  rate  per  cent  for  collecting,  etc. 

3.  Arbitrary  rates  in  vogue  in  some  banks. 

4.  A  charge,  by  some  banks,  on  time  paper,  but  no  charge  on  cash 
paper. 

5.  The  size  of  a  depositor's  bank  balance.  The  heaviest  depositor 
usually  gets  the  lowest  collection  rate. 

6.  On  the  whole,  the  rates  of  collection  are  more  uniform  in  the 
Eastern  and  Middle  States. 

Transactions  for  the  Collection  Clerk,  March  1 

As  collection  clerk,  make  the  proper  records  in  the  collection  regis- 
ter for  the  following  paper  received  for  collection  to-day.  Examine  the 
model  given  for  this  book  on  pages  20  and  21. 

No.  800.  Note  signed  by  Clarke  &  Coffin,  dated  Jan.  31,  at  30  days, 
indorsed  by  Ellis,  Shannon  &  Co.,  payable  at  our  bank,  for  f7200.  To 
be  collected  for  Janis,  Cooper  &  Tremper. 

No.  801.  Note  signed  by  Henry  Green,  payable  in  two  months  from 
Jan.  4,  at  Park  Square  National  Bank,  City,  for  $4000.  To  be  collected 
for  Charles  J.  Kennedy. 

No.  802.  Note  signed  by  Ellis  Peterson,  payable  in  60  days  from 
Jan.  4,  at  Union  Trust  Co.,  City,  for  |2000.  To  be  collected  for  Charles 
J.  Kennedy. 

No.  803.  Draft  dated  Jan.  3,  at  60  days  from  date,  on  James  Briggs, 
payable  at  Central  Bank,  City,  for  $905.42.  To  be  collected  for  Fields 
Milling  Co. 

No.  804.  Note  signed  by  W.  B.  Anderson,  payable  in  60  days  from 
Jan.  5,  at  First  National  Bank,  Worcester,  for  1162.90.  To  be  collected 
for  Ninth  National  Bank,  Hartford,  Conn. 

No.  805.  Draft  dated  Jan.  4,  at  60  days  from  date,  on  McMenimen 
Bros.,  payable  at  First  National  Bank,  Worcester,  for  11262.90.  To  be 
collected  for  Ninth  National  Bank,  Hartford,  Conn. 

Post  the  collection  register  to  the  collection  tickler.  Leave  the 
Where  Sent  and  Remarks  columns  blank  for  the  time  being. 

Submit  your  collection  register  and  collection  tickler  to  your  instructor 
for  approval  before  proceeding  further. 


BANKING 


27 


WORK  OF   THE   RECEIVING   TELLER 


The  records  of  the  receiving  teller  in  this  set  are  to  be  found  on 
the  receiving  teller's  daily  check  sheets. 

The  following  is  the  form  of  check  sheet  and  proof  to  be  used  in 
this  work.     (See  page  95.) 

-    Receiving  Teller's  Daily  Check  Sheet  and  Proof 

Monday,  April  2,  19  — 


» 


OK. 

ACCOUNT 

CURRENCY 

# 

CLEARING 
HOUSE 

X 

OUT-OF- 
TOWN 

B 

OUR 
BANK 

0 

CITY 
OFFICE 

COLLEC- 
TION AND 
EXCHANGE 


AMOUNT 
CREDITED 

n/ 

Decker  Bros, 

1120 

1200 

50 

192 

10 

600 

3112 

60 

\/ 

Mace,  Gilmore  &  Co. 

250 
190 

54 
200 

09 

750 

50 

60 

75 

1493 

94 

^ 

Spencer,  Mead  &  Co. 

60 

300 
3000 

1500 

500 
100 

65 

1 

50 

5523 

50 

V 

D.  B.  Roberts 

1500 

1500 

\/ 

E.  L.  Howard 

900 

90 

899 

10 

V 

W.  I.  Pratt 

620 
50 

7200 

2500 

10370 

n/ 

C.  E.  Selover  &  Co. 

1642 

50 

1642 

50 

V 

Coll.  and  Exch.    Paid  in  cash 

1 

65 

1 

65 

n/ 

Fields  Milling  Co. 

690 
140 

750 

1580 

V 

Cashier's  Check 

9200 

9200 

12321 

65 

11954 

59 

4792 

50 

1 

3092 

70 

3165 

4 

80 

35321 

64 

Recapitulation  and  Proof 


Bills 

501 

05 

Deposits 

35321 

©4 

Coin 

5820 

Collection  and  Exchange 

4 

80 

Clearing  House 

11954 

59 

Out-of-Town 

4792 

50 

Our  Bank 

3092 

70 

City  Office 

3165 

Paying  Teller  (Special) 

6000 

36326 

44 

35326 

44 

28  BOOKKEEPING 

Receiving  Teller's  Daily  Check  Sheet  and  Proof.  —  A  great  variety  of 
forms  of  this  sheet  is  used  by  banks.  In  some  cases  the  sheet  exhibits 
only  the  total  of  the  deposit  tickets  and  the  aggregate  receipts  of  the 
day.  In  other  cases  it  is  in  the  form  of  a  cash  book,  the  receipts  in 
currency,  clearings,  collection  and  exchange,  out-of-town  items,  etc.,  being 
separated  by  the  use  of  special  columns.  The  kind  of  record  required 
would  always  depend  upon  the  routine  of  the  bank's  business. 

The  Duties  of  the  Receiving  Teller  may  be  specified  as  follows : 

1.  He  receives  the  deposits  of  customers. 

2.  He  writes  certificates  of  deposit  and  cashier's  checks. 

3.  He  enters  deposits  in  the  customers'  pass  books. 

4.  He  classifies  the  items  received  for  deposit. 

Certificates  of  Deposit.  —  Certificates  of  deposit  are  receipts  issued 
by  a  bank  to  persons  making  temporary  deposits.  They  are  negotiable 
and  pass  everywhere  as  cash.  They  are  taken  from  a  book  resembling 
the  ordinary  check  book,  a  stub  showing  the  number,  date,  amount, 
payee,  etc.,  being  retained  by  the  bank.  The  person  to  whom  a  certificate 
is  issued  is  required  to  write  his  name  on  the  stub  of  the  certificate  of 
deposit  book  in  order  that  the  proper  comparisons  may  be  made  when 
the  certificate  is  presented  for  payment.  These  certificates  may  bear 
interest  or  not,  depending  on  the  circumstances. 


is 

^  2 


SJ 


^     1 

>i       o 


K/he  >^nlational  ^Jjank  of  i^ommerce 

CLiM-eAt   c/.   €aM-cy\yvi has   deposited  in    this   *Jjanh 

zPciycihle   to   the   order  of  kvm.^&t'l^-^^--^-^^-^^^--^-.^-.^'.^^^^^^ 

on    the   return    of  this    (Certificate  properly   indorsed 

(Cashier 


Cashier's  Checks.  —  Cashier's  checks  are  quite  similar  to  the  ordinary 
checks  of  customers,  except  that  they  are  signed  by  the  cashier  of  the 
bank  on  whom  they  are  drawn.  They  are  sometimes  used  instead  of 
bank  drafts  and  in  paying  the  proceeds  of  paper  discounted,  but  are 


I 


BANKING  29 

more  frequently  employed  in  paying  the  general  expenses  of  the  bank, 
except  small  incidental  items,  which  are  usually  paid  by  means  of  charge 
tickets  signed  by  the  cashier. 


CO 


^ 


^Boston,  ^Mass,,  <^e-(^.  I^,  79 ^o,    7^0 

K//ie  ^^latlonal  K/janU  of  fj\.eoemption 

^ay    to    the    orden   of  ^^^y.    ^li.'yttU    V    ^a.    //i'f^.^-^ 

(Bashien 


\ 


Nature  of  Deposits.  —  As  deposits  come  in  from  customers  they  may 
consist  of  any  one,  or  all,  of  the  following  items : 

1.  Currency. 

2.  Orders  payable  through  the  clearing-house  association. 

3.  Orders  payable  out  of  town. 

4.  Orders  payable  by  our  bank. 

6.  Orders  payable  by  bankers  in  our  city  not  members  of  the 
clearing-house  association. 

Classifying  Items  on  the  Deposit  Ticket.  —  As  a  deposit  comes  in, 
the  receiving  teller  places  the  deposit  ticket  before  him  and  pro- 
ceeds to  count  the  coin  and  bills.  If  they  are  found  to  agree  with 
the  amounts  on  the  ticket,  a  check  mark  ( V)  is  placed  at  the  left  of 
the  items  listed. 

Each  check,  draft,  or  other  bankable  instrument  is  then  carefully 
examined  to  see  if  it  is  properly  indorsed.  If  this  paper  is  approved, 
it  is  next  checked  off  and  classified  on  the  deposit  ticket  as  follows : 

1.  If  payable  by  a  bank  which  is  a  member  of  the  clearing-house 
association,  the  clearing-house  number  of  that  bank  is  written  at  the 
left  of  the  item. 

2.  If  payable  by  an  out-of-town  bank,  a  cross  ( X )  is  written  at  the 
left  of  the  item. 

Note.  —  Sometimes  deposit  tickets  are  provided  with  a  separate  column  for  items 
payable  out  of  town.  In  such  cases  the  out-of-town  items  are  sufficiently  classified 
when  the  deposit  ticket  comes  in  to  the  receiving  teller. 


30 


BOOKKEEPING 


3.  If  payable  by  a  city  bank  not  a  member  of  the  clearing-house 
association  the  letter  O  is  written  at  the  left  of  the  items. 

Note.  —  O  is  intended  to  signify  Office,  a  term  meaning  that  the  paper  is  payable 
at  some  banking  or  business  office  in  the  city  instead  of  through  the  clearing-house 
association.  These  items  are  sent  by  runners  and  payment  received  in  cash  or  by 
an  acceptance  payable  at  a  clearing-house  bank.  If  the  paper  is  accepted  instead 
of  paid,  it  is  returned  and  entered  with  the  exchanges  for  the  clearing-house  associa- 
tion for  the  following  day. 

4.  If  payable  by  our  bank,  the  letter  B  is  written  to  the  left  of  the 
items. 


DEPOSITED  IN  THE 

J^atlonal  Citi/  ^ank 

3Si/    Jr^imn/i'yb  l^  Gcyrul 

^Boston.     ^^(>-   f^,     79- 

J^oUars 

Cents 

Specie v^ 

^'00 

Bills v/ 

700 

Check .    ^S7 

2^0 

c^q 

^ 

/ 

SOO 

60 

#/^ 

/ 

^00 

X. 

500 

B 

700 

J 

/f/ 

^Cf 

Transactions  for  the  Receiving  Teller,  March  1 

Take  the  blank  for  receiving  teller's  daily  check  sheets  and  enter  the 
following  deposits.  Study  very  carefully  the  form  given  on  page  27, 
and  if  you  do  not  understand  any  point,  consult  your  instructor.  The 
nature  of  the  deposit  in  the  following  transactions  is  indicated  by  the 
characters  just  explained. 


BANKING 


31 


Decker  Bros.,  V  $600,  B  $1500,  B  $720.50. 

Mace, Gilmore  &  Co.,  V 1720,  V  |400,#  61  $1290,  #4  $1500,  #31  $650. 
Spencer,  Mead  &  Co.,  B  $1250.20,  B  $340.20,  X  $1340.20,  X  $1343.46, 
$342.90  ;  less  collection,  $2.75. 

D.  B.  Roberts,  V$120,  V  $60,  #32  $950.60,  O  $1625,  B  $72.60. 
Fernald,  Son  &  Co.,  V  $725,  B  $650.60,  O  $900,  X  $1750 ;  less  col- 
lection, $1.75. 

W.  I.  Pratt,  V  $120,  B  $1625,  X  $1900;  less  collection,  $1.90. 
F.  E.  Sherman,  O  $156.90,  B  $1750,  #15  $165.90,  V  $7200. 
C.  E.  Denison,  X  $1590.60,  V  $2500,  B  $200,  #12  $1560;  less  col- 
5ction,  $1.50. 
Thomas    Bennett   &   Co.,  V  $400,  B   $262.90,  B  $40.50,  B   $200, 
60$4126.20,  #11  $2142.10,  #5  $1462.90,  #3  $2460.10,  X  $1325.62, 
$1462.91,  X  $142.10;  collection,  $2.25,  paid  in  cash. 

Note.  —  When  the  collection  charges  on  any  paper  deposited  are  paid  in  cash 
le  amount  is  not  deducted  from  the  deposit  slip.    On  the  receiving  teller's  sheet  the 
items  of  deposit  and  collection  charges  are  entered  as  usual,  and,  in  addition,  the 
imount  of  the  collection  charges  is  written  in  the  Currency  column. 

E.L.Howard,  V$1450,  B  $1242.10,  X  $1121.40,  x  $24.16,  X  $142.60 ; 
[ess  collection,  $1.25. 

Charles  J.  Kennedy,  V  $350,  #17  $1210,  #27  $1620.40. 

E.  V.  Buckley  &  Son,  x  $621.40,  x  $340,  x  $4000;  less  collec- 
Lon,  $1. 

Foot  the  columns  of  the  receiving  teller's  daily  check  sheet.  The 
mm  of  the  first  five  columns  should  equal  the  sum  of  the  last  two. 

Make  out  the  Recapitulation  and  Proof  blank.  Bills  on  hand,  $10,760  ; 
5oin,  $987.25.  You  have  given  to  the  paying  teller  during  the  day 
J2900.  The  remaining  items  of  the  proof  are  taken  from  the  receiving 
jUer's  daily  check  sheet  footings. 

The  debit  and  credit  sides  of  your  proof  should  balance. 

Submit  the  receiving  teller's  work  to  your  instructor  for  approvah 


WORK  OF  THE   PAYING  TELLER 

The  records  of  the  paying  teller  in  this  set  are  to  be  found  on  the 
[paying  teller's  daily  check  sheets. 

Paying  Teller's  Daily  Check  Sheet  and  Proof.  —  A  great  variety  of 
Eorms  of  this  sheet  is  used  by  banks.     The  nature  of  the  records  in  this 
lepartment  would  depend  upon  the  general  routine  and  volume  of  the 
[work  of  any  particular  bank.    The  sheet  on  pages  32  and  33,  with 


BOOKKEEPING 


Paying  Teller's  Daily 


PAYMENTS 


CK. 

B 

OUR  BANK 

# 

CLEARING 
HOUSE 

X 

OUT-OF-TOWN 

0 

CITY  OFFICE 

EXPENSE              1 

j 

V^ 

Fields  Milling  Co. 

200 

y/ 

Charles  J.  Kenned^/ 

13000 

V 

C.  E.  Selover  &  Co. 

720 

V 

C.  E.  Dmison  {N.  Y.  D.) 

560 

75 

V 

D.  E.  Avery  {N.  Y.  D.) 

240 

50 

- 

V 

J.  H.  Crandall 

1001 

50 

V 

W.  I.  Pratt 
Bunker  Rill 
Traders 
Park  Square 
Traders,  Buffalo 
Alliance,  Springfield 
Farmers,  Albany 
Mechanics 
Powers 
Coal  bill 
Carpenter  work 

238 

75 

10160 
300 
560 

40 

1346 
7645 
1900 

50 
90 
40 

200 
150 

5 
9 

50 
50 

15961 

50 

11020 

40 

10892 

SO 

350 

15 

Recapitulation 


RECEIPTS 

1.  Cctsh  from  yesterday 

90150 

50 

2.  neceiving  Teller 

9200 

50 

3.  Note  Teller 

11420 

4.  Jteceiving  Teller  {Special) 

14000 

5,  Collection  and  Exchange                                                            S.oo^  12. oo 

15 

6.  New  York  J>ra/ts 

2100 

7.  Balance  from,  Clearing  House 

7120 

50 

.   .- 

134006 

50       * 

i 

BANKING 


33 


Check  Sheet  and  Proof 


Saturday,  April  7,  19 


RECEIPTS 


SALE   OF   NEW  YORK   DRAFTS 


SOLD    FOR   CASH 


/.  M.  Cox  &  Co. 
R.  Bdble  &  Co. 


SOLD  FOR  CHECK 


C.  E.  Denison 

D.  E.  Avery 


Balance  front  yesterday's  proof 
Receiviny  Teller,  from  yesterday 
Note  Teller,  from  yesterday 
Receiving  Teller  (Special) 
(<  ((  (t 

Balance  from  Clearing  House 


AMOUNT 


500 

800 
560 


2100 


00 


SUNDRY 
RECEIPTS 


90150 

9200 
11420 
9000 
5000 
7120 


131891 


50 


50 


SUNDRY 
COLL.  &  EXCH. 


12 


00 


and  Proof 


PAYMENTS 

1.  Checks  on  our  Bank 

15961 

50 

2.  Clearing- House  Checks 

11020 

40 

3.  Out-of-town  Checks 

10892 

80 

4.  City  Office  Items 

350 

S.  Sundry  Expense 

15 

6.  Balance  to  Clearing  House 

7.  Cash  on  hand 

05766 

80 

134006 

50 

34  BOOKKEEPi:NrG 

slight  modifications,  is  representative  of  the  paying  teller's  records  in 
many  large  banks  of  the  country. 

As  will  be  readily  seen,  all  money  paid  out  or  received  by  the  paying 
teller  at  the  time  of  such  disbursement  or  receipt  is  entered  on  this 
daily  check  sheet. 

Recapitulation  and  Proof.  —  At  the  close  of  each  day's  business  the 
paying  teller  prepares  the  proof,  showing  the  character  and  condition 
of  the  cash  on  hand,  and  the  receipts  and  disbursements  during  the 
day.    The  items  of  this  proof  may  be  explained  as  follows  : 

Receipts 

1.  Balance  on  hand  from  the  previous  day's  proof. 

2.  Bills  and  coin  received  from  the  receiving  teller  at  the  close  of 
the  previous  day's  business. 

3.  Bills  and  coin  received  from  the  note  teller  at  the  close  of  the 
previous  day's  business. 

4.  Cash  transferred  from  the  receiving  teller  during  the  day. 

5.  Receipts  for  collection  and  exchange. 

6.  Receipts  for  the  sale  of  drafts. 

7.  Balance  (if  any)  paid  by  the  clearing  house. 

The  clearing-house  balance  may  appear  on  either  side  of  the  paying 
teller's  proof  sheet.  If  the  amount  of  the  checks,  drafts,  etc.,  taken  to 
the  clearing  house  is  greater  than  the  amount  of  checks  received  there, 
the  clearing  house  pays  the  settling  bank  the  difference,  and  the  amount 
is  counted  among  the  receipts  on  the  paying  teller's  proof.  If  the 
amount  of  the  checks  received  at  the  clearing  house  is  greater  than  the 
amount  of  checks  brought,  the  bank  settling  pays  the  clearing  house 
the  difference,  and  this  amount  is  counted  among  the  payments  on  the 
paying  teller's  proof. 

Payments 

The  items  on  this  side  are  self-explanatory,  since  they  are  merely  the 
footings  of  the  payments  on  the  check  sheet  summarized.  The  cash  on 
hand  is  the  total  bills  and  coin  in  the  possession  of  the  paying  teller  at 
the  close  of  the  day's  business.  These  bills  and  coin  are  generally 
classified  as  follows: 

1.  National  bank  notes.  5.  Silver  certificates. 

2.  Gold  coin.  6.  Legal-tender  notes. 

3.  Gold  certificates.  7.  Subsidiary  silver  coin. 

4.  Silver  dollars.  8.  Minor  coin. 


BANKING  35 

The  Duties  of  the  Paying  Teller  may  be  specified  as  follows : 

1.  He  is  the  custodian  of  the  cash,  and  the  general  disbursing 

officer  of  the  bank. 

2.  He  cashes  checks  presented  by  customers  and  others. 

3.  He  certifies  the  checks  of  customers. 

4.  He  may  sell  bank  drafts. 

The  paying  teller's  position  is  charged  with  more  responsibility  than 
that  of  any  other  person  in  the  bank,  except  the  officers.  He  must  be 
a  man  of  the -strictest  integrity,  possessed  of  tact,  and  thoroughly  con- 
versant with  the  laws  governing  bank  checks  and  drafts.  His  most 
responsible  duty  is  to  see  that  no  money  is  paid  out  improperly. 
Among  the  many  things  that  he  should  have  in  mind  when  checks 
are  presented  the  most  important  may  be  stated  as  follows: 

1.  Signatures  of  customers. 

2.  New  signatures,  powers  of  attorney,  notices  stopping  payments 

of  checks,  etc, 

3.  Definite  knowledge  of  the  parties  presenting  vouchers. 

4.  Average  balances  of  customers,  so  that  overdrafts  may  be 

prevented. 
When  checks,  etc.  are  received  the  paying  teller  should  note  : 

1.  That  they  are  properly  dated. 

2.  That  they  are  indorsed. 

3.  That  the  amounts  written  in  words  agree  with  the  amounts 

written  in  figures. 

Form  of  Certified  Check 


J^o.720 
'dollars 

1 

^tidyyuAf,  S'oo 

The  Certified  Check  Book.  —  The  paying  teller  preserves  a  record  of 
all  checks  certified,  in  a  book  kept  especially  for  this  purpose.     From 


36 


BOOKKEEPING 


this  book  the  customer  is  charged  in  the  individual  ledger  and  Certified 
Checks  credited.     The  following  is  the  usual  form  of  this  book. 


Certified  Check  Book 


^ 


DATE 
CERTIFIED 

DRAWER  OF  CHECK 

FOR  WHOM  CERTIFIED 

CK. 

AMOUNT  OF 
CHECK 

WHEN  PAID 

AMOUNT  PAID 

19— 

Peb. 

15 
15 
15 

D.  B.  Roberts 

Thos.  Bennett  &  Co. 
Spencer,  Mead  &  Co. 

W.  I.  Pratt 
J.  0.  Baker 
Decker  Bros. 
F.  E.  Sherman 

D.  B.  Roberts 
M.  D.  Borrows 
W.  W.  Bennett 

W.  I.  Pratt 

Elwood  &  Sperry 
Reardon  &  Smith 
F.  E.  Sherman 

V 
V 

V 

6000 
1750 
2000 

19— 

Feb. 
Feb. 

18 
17 

19 

18 

23 

5000 
1750 

1500 
2000 

1500 

8750 

Feb. 

16 
16 
16 
16 

1500 
2000 
7249 
1500 

20 

12249 

20 

i 

Transactions  for  the  Paying  Teller,  March  1 

Take  the  blank  for  paying  teller's  daily  check  sheets  and  enter  the 
following  transactions.  Study  very  carefully  the  form  given  on  pages 
32  and  33.    Consult  your  instructor  if  you  need  to. 

1.  Checks  on  our  bank  paid  to-day  are  as  follows  : 

Charles  J.  Kennedy  (New  York  draft),  1420.75;  F.  E.  Sherman, 
$1200;  Powers  &  Sprague,  $1000;  Lane,  Rowell  &  Co.,  |300; 
Wyckoff,  Seamans  &  Benedict,  $450 ;  Janis,  Cooper  &  Tremper, 
11500;  Fields  Milling  Co.,  $500;  J.  O.  Baker,  $1049.75;  W.  1. 
Pratt,  $725. 

2.  Checks  on  clearing-house  banks  paid  to-day  are  as  follows : 
Bunker  Hill  National  Bank,  $920;  Suffolk  National  Bank,  $750;  Colo- 
nial National  Bank,  $609.05 ;  Shoe  and  Leather  Bank,  $500 ;  Third 
National  Bank,  $400;  Metropolitan  National  Bank,  $725  ;  Eliot  National 
Bank,  $1250.40;  Citizens  National  Bank,  $4120.40;  Park  Square 
National  Bank,  $2140.50;  New  England  National  Bank,  $1440.50. 

3.  Checks  on  out-of-town  banks  paid  to-day  are  as  follows : 
Manufacturers  and  Traders  Bank,  Philadelphia,  $700.50;  collection, 

75/.  Bank  of  Commerce,  Baltimore,  $1300;  collection,  $1.25.  Fourth 
National  Bank,  Hartford,  $3250  ;  collection,  $3.  Farmers  Bank,  Albany, 
$1500;  collection,  $1.50. 

4.  Checks  on  banks  in  our  city  not  members  of  the  clearing  house, 
paid  to-day,  are  as  follows: 

Union  Trust  Co.,  $300;  Powers  Bank,  $572.50. 


I 

r 


BANKING  37 

Sold  the  following  drafts  on  Chemical  National  Bank,  New  York. 

1.  Sold  for  cash : 

Frey  &  Thomas  Co.,  $1500;  exchange,  81.50.  David  Gray,  1500; 
exchange,  50/.     Charles  M.  Miner,  $750;  exchange,  75/. 

2.  Sold  for  check : 

Charles  J.  Kennedy,  $420.50;  exchange,  25/. 

Enter  the  above  on  the  paying  teller's  daily  check  sheet. 

Open  the  certified  check  book.  There  is  but  one  unpaid  check,  as 
follows:  check  of  Wyckoff,  Seamans  &  Benedict,  dated  Feb.  23, 
certified  for  Elliot  Mfg.  Co.,  $17,500. 

Draw  a  double  red  line  immediately  under  this  amount,  so  that  it 
will  not  be  counted  when  the  certified  checks  for  to-day  are  footed. 

Certify  the  following  checks:  J.  H.  Crandall,  $1200;  C.  E.  Denison, 
$500;  W.  I.  Pratt,  $600. 

Enter  the  above  in  the  certified  check  book. 

Pay  cashier's  charge  ticket  for  2  tons  of  coal,  $9.50. 

The  items  for  the  Sundry  Receipts  column  are  as  follows : 

Bills  and  coin  from  yesterday's  proof,  $206,710.81;  bills  and  coin 
received  from  the  receiving  teller  at  the  close  of  yesterday's  business, 
$15,280.45 ;  bills  and  coin  received  from  the  receiving  teller  during  the 
day,  $2900;  bills  and  coin  received  from  the  note  teller  at  the  close  of 
yesterday's  business,  $5504.40;  received  from  the  clearing  house  for 
to-day's  exchanges,  $31,863.11. 

Add  the  columns  of  the  paying  teller's  daily  check  sheet.  Make  out 
the  Recapitulation  and  Proof  blank.  A  careful  count  of  the  cash  now 
on  hand  under  various  heads  (subdivisions  of  bills  and  coin  only)  shows 
an  amount  of  $237,804.92. 

Foot  the  certified  check  book.  Submit  your  paying  teller's  records 
to  your  instructor  for  approval. 

Note.  —  The  paying  teller  makes  out  his  proof  before  the  cash  from  the  receiv- 
ing teller  and  note  teller  has  been  turned  over  to  him.  After  the  receiving  teller 
and  note  teller  respectively  make  their  proofs  they  turn  over  the  balance  of  cash 
in  their  hands  to  the  paying  teller.  These  amounts  appear  on  the  paying  teller's 
proof  on  the  day  following. 

WORK  OF   THE   NOTE   TELLER 

The  Duties  of  the  note  teller  are  difficult  to  define,  since  there  is  a 
wide  difference  among  banks  as  to  the  work  assigned  to  this  clerk.  In 
nearly  all  banks,  however,  he  is  required  to  present  for  payment  such 
notes,  acceptances,  coupons,  etc.,  as  are  due  and  payable  in  the  city, 


38  BOOKKEEPING 

and  to  collect  the  city  office  items  turned  over  to  him  at  the  close  of 
each  day  by  the  receiving  teller,  paying  teller,  and  correspondence  clerk. 
The  Runners  of  the  bank  are  generally  under  the  supervision  of  the 
note  teller.  These  runners  are  assigned  a  definite  route,  which  they 
cover  daily,  and  present  for  payment  or  acceptance  such  paper  as  may 
be  allotted  to  them.  They  keep  a  route  hooh^  in  which  is  recorded  a 
full  description  of  such  paper. 

The  Note  Teller's  Records. — As  a  rule  the  charge  and  credit  tickets, 
letters,  or  other  memoranda  which  affect  the  general  ledger,  the  credit 
tickets  for  the  proceeds  of  bills  discounted,  and  collection  items  for  the 
individual  ledger  pass  through  the  note  teller's  hands  before  reaching 
the  general  and  individual  bookkeepers.  To  make  this  work  as  simple 
as  consistent  with  approved  banking  practice,  we  have  deviated  from 
this  plan  to  the  extent  of  deferring  these  items  until  the  enumeration 
of  the  memoranda  for  the  general  and  individual  bookkeepers'  transac- 
tions is  given  on  subsequent  pages.  The  note  teller's  daily  check  sheets 
and  proofs  will  therefore  be  omitted.  The  sagacious  student,  however, 
would  soon  perceive  the  offices  and  possibilities  of  these  sheets  in 
banks  making  use  of  them. 

Charging  Notes  to  Out-of-Town  Banks.  —  Notes  and  drafts  discounted, 
payable  out  of  town,  are  usually  sent  away  for  collection  about  ten 
days  before  they  are  due.  At  the  maturity  of  these  notes  and  drafts 
they  are  charged  to  the  banks  to  which  they  are  remitted,  without 
waiting  for  letters  advising  collection. 

Each  morning  the  discount  clerk  takes  the  bills  discounted,  payable 
in  the  city  and  falling  due  on  that  particular  day,  from  the  note  file 
and  compares  them  with  the  items  listed  on  the  discount  tickler,  after 
which  they  are  handed  to  the  note  teller  for  collection.  As  the  paper  is 
disposed  of  a  record  is  made  in  the  Remarks  column  of  the  discount 
tickler. 

Make  the  proper  records  in  the  discount  tickler  for  the  paper  disposed 
of  to-day.     In  the  Remarks  column  write  : 

For  No.  889,  Charged  to  Pratt 

For  No.  866,  Charged  to  Traders  National, 

For  No.  842,  Charged  to  Traders  National, 

For  No.  893,  Certified,  M.  N  B. 

For  No.  901,  Certified,  K  N,  B. 

Note.  —  Nos.  866  and  842  will  be  charged  to  the  banks  specified  at  their  face. 
It  is  customary  with  banks  not  to  make  any  record  of  collection  and  exchange  on 
such  items  until  the  bank  to  which  the  notes  were  remitted  sends  notice  of  collection. 


BANKING 


39 


Rule  and  foot  the  discount  tickler.     (See  model,  pages  16  and  17.) 
Each  morning  the  collection  clerk  proceeds,  in  much  the  same  manner  as 
the  discount  clerk,  to  turn  over  to  the  note  teller  the  collections  payable  in 
the  city  and  falling  due  on  any  particular  day.     As  this  paper  is  disposed 
of  a  record  is  made  in  the  Remarks  column  of  the  collection  tickler. 

Make  records  in  the  collection  tickler  for  the  paper  disposed  of  to-day. 
In  the  Remarks  column  write : 
For  No.  744,  Paid,  3/1. 
For  Ko.  755,  Paid,  S/L 
Collections  are  not  charged  to  the  banks  to  which  they  are  sent  until  a 
report  of  collection  has  been  received.     Farmers  Bank,  Albany,  reports 
that  collections  650  and  702  have  been  paid  and  placed  to  the  credit  of 
your  account.     In  the  Remarks  column  of  the  collection  tickler  write : 
For  No.  650,   Charged  Farmers  Bank,  3/1.     Bank's  collection, 

$1.75;  our  collection,  75 ff. 
For  No.  702,   Charged  Farmers  Bank,  3/1.     Bank's  collection, 
$1.20;  our  collection,  $3. 


Form  of  Letter  advising  of  Collections  Credited 


John  0.  Norris,  President                                                                         Robert  Hall,  Vice  President 

L.  H.  PiERSON.  Cashier 

National  Exchange  Bank 

Albany,  N.Y.,     c^^^.  is,     19 

Mr.    ^Aa^.  la.   /{-a.^n^lltcyn.,    Cashier 

JSoatcyyv,    7lia-2^^. 

Dear  Sir, — We  credit  your  account  this  day  for  the  proceeds  of 
collections  as  stated  below.            Respectfully  yours, 

L.    //-.    S'l^x^cy)^,    Cashier 

YOUR  NO. 

PAYER 

AMOUNT 

CHARGES 

PROCEEDS 

7/6 
7/0 

^.    €.    /Scyyvoi 
10'.    ^.    La^uf 

800 

^00 
760 
600 

2 
2 
/- 
/ 

60 
60 
26 

7^8 

8^7 
7^8 

60 
60 
76 

2^60 

i       r 

26 

2^^2 

76 

40 


BOOKKEEPIKG 


WORK  OF  THE   CORRESPONDENCE   CLERK 

The  province  of  this  clerk  is  to  keep  the  accounts  of  all  the  out-of- 
town  banks  with  whom  we  have  dealings.  All  cash  items  received  from 
or  sent  to  these  banks  are  handled  by  this  clerk,  and  so  kept  entirely 
separate  from  the  items  received  for  collection  by  the  collection  clerk. 

Checks  and  sight  drafts  received  on  deposit,  which  are  payable  out 
of  town,  are  remitted  to  our  correspondents  (out-of-town  banks  with 
whom  Ave  have  regular  dealings)  the  same  as  cash. 

Sometimes  the  collection  clerk  handles  checks  on  out-of-town  banks 
and  sight  papers  payable  out  of  town.  If  any  paper  is  received  for 
collection,  it  should  be  turned  over  to  the  collection  clerk,  entered  in 
the  collection  register,  and  transferred  to  the  collection  tickler.  If  any 
paper  is  received  on  deposit,  it  should  be  turned  over  to  the  corre- 
spondence clerk  and  entered  in  the  remittance  register  to  the  credit  of 
the  bank  making  the  remittance.     (See  page  95.) 


Remittance  Register  and 


Chemical  National 


DATE  OF 

C.  B. 
FOLIO 

EXPLANATION  OF  TRANSACTION 

DESCRIPTION  OF  REMITTANCE  ITEMS 

TRANSACTION 

INDORSER 

PAYER 

Feb. 

2 

Balance 

3 

Remitted  for  credit 

F.  E.  Sherman 

A.  B.  Lyman 

Remitted  for  credit 

C.  E.  Denisou 

Ruggles  &  Co. 

Remitted  for  credit 

Powers  &  Sprague 

Filens  &  Co. 

41 

Remitted  for  credit 

Fernald,  Son  &  Co. 

Moore  &  Freeman 

3 

41 

Discount  No.  590,  charged 

3 

40 

Total  items  received  for  credit 

d^^K 

4 

41 

Discount  No.  565,  charged 

'^^^v 

4 

40 

Total  items  received  for  credit 

'^^B 

4 

40 

Drafts  per  draft  register 

^B 

Remittance  Register  and  Out-of-Town  Banks  Ledger.  —  This  book  con- 
tains a  record  of  all  transactions  with  out-of-town  banks.  It  serves  the 
double  purpose  of  registering  remittances  and  giving  a  full  and  detailed 
ledger  account  of  all  out-of-town  banks.  The  aggregate  balances  of  the 
accounts  in  this  book  should  at  all  times  agree  with  the  balance 
Out-of-Town  Banks  account  in  the  general  balance  ledger. 


BANKIKG 


41 




^■the  present  time. 

W 


raders  ]N"ational  Bank,  Buffalo 

Manufacturers  and  Traders  Bank,  Philadelphia 

Bank  of  Commerce,  Baltimore 

Fourth  iSTational  Bank,  Chicago 
^H  Ninth  National  Bank,  Hartford 
^B  Chase  National  Bank,  Providence 
^BChemical  National  Bank,  New  York 
^■Farmers  Bank,  Albany 
^■Alliance  National  Bank,  Springfield 
^Brirst  National  Bank,  New  York  (Approved  Ke 
^H     serve  Agent) 

I 

Bank.  Ne-w  York 


Dr. 
$2754.90 


Cr. 


$1472.20 


648.90 


3240.95 

15219.65 

3752.60 

7572.20 

75920.50 

5214.90 

162240.70 


Enter  the  above  balances  in  the  remittance  register,  one  account  to 
a  page.   The  amounts  of  all  balances  in  this  book  are  written  in  red  ink. 

Out-of-Town  Banks  Ledger 


fc 

CHARGED 

LEDGER  STATEMENT  OF  THE  ACCOUNT 

1 

WHERE  PAYABLE 

DATE  OF  PAPER 

AMOUNT 

DEBIT  BALANCES 

CHARGES 

CREDITS 

CREDIT  BALANCES 

I 

IIDO 

CO 

■ 

Your  bank 

Feb. 

1 

500 

90 

■ 

Ninth  National 

1 

650 

Traders  Nat'l,  Brooklyn 

2 

750 

1 

Second  National 

2 

920 

2820 
7500 

10320 

90 

90 

9115 

75 

1000 

2G95 

3620 
6590 

10210 

75 
90 

90 

95 

15 

This  morning's  mail  contained  the  following  amounts  from  the  banks 
named,  for  credit.  Enter  the  amounts  in  the  remittance  register,  being 
very  careful  to  record  everything  correctly.  Study  the  accompanying 
model.  Only  the  total  remittances  are  given  below,  since  the  items 
need  not  be  recorded  in  the  remittance  register.  The  letters  containing 
an  itemized  statement  of  this  paper  are  filed  for  reference,  and  may  be 


42 


BOOKKEEPING 


examined  whenever  it  is  necessary  to  look  up  any  of  the  details  relating 
to  any  particular  remittance. 

Traders  National  Bank,  BufPalo  $1142.90 

Bank  of  Commerce,  Baltimore  1642.95 

Fourth  National  Bank,  Chicago  4694.25 

Chemical  National  Bank,  New  York  560.20 

Manufacturers  and  Traders  Bank,  Philadelphia  4500. 

Chase  National  Bank,  Providence  1721.42 

Farmers  Bank,  Albany  4921.62 

Alliance  National  Bank,  Springfield  3752.88 

Form  of  Letter  advising  Remittance  of  Cash  Items  for  Credit 


HENRY  L.  MILLER,  President                                                                                                    GEO.  A.   DUNKLE.    Vice  President 

G.   W.   WILLIAMS,   Cashier 

>,^m.anufacturers    and  K/raders    fjjank 

Philadelphia.    ^ct„       ^eA.    27,       19— 
^Mn,    €.   ^.  ^OLUf-e.,    Cashier 

SDear     Sir, 9?lease     find    herewith     for     CREDIT     to 

our  account  the    items    listed  Below . 

DATE 

DRAWEE 

ITEMS 

AMOUNT 
CHARGED 

c^5^. 

2^ 
23 
26 

yo-iih  ISa/nk 

Hid   ^otcyyi^f   c/iatuyyuLl 

760 
2^0 
600 

^/O 

/6(fO 

c^O 

Very    respectfully  yours, 

c^.    ^.    14Mtlla.viQ^,    Qashier 

The  following  are  the  drafts  drawn  on  Chemical  National  Bank,  New 
York,  as  per  stubs  in  the  draft  book. 

No.  430,  $1500;  No.  431,  $500;  No.  432,  $750;  No.  433,  $420.50. 


i 


BANKING 


43 


Enter  the  foregoing  drafts  in  the  draft  register.  Foot  the  draft 
register  and  credit  Chemical  National  Bank  in  the  remittance  register 
for  the  total.     Check  the  amount  transferred. 

The  Draft  Register.  —  Bank  drafts  are  taken  from  a  book  resembling 
an  ordinary  check  book.  They  are  in  reality  checks  of  one  banking 
institution  upon  another  banking  institution.  In  due  time  they  find 
their  way  to  the  banks  upon  which  they  are  drawn ;  they  are  charged 
to  the  banks  drawing  them,  and  then  returned  in  much  the  same  manner 
as  the  checks,  of  resident  depositors.  These  drafts  are  transferred  from 
the  draft  book  to  the  draft  register,  —  a  blank  provided  with  two 
columns,  one  for  the  numbers,  and  one  for  the  amounts  of  the  drafts. 
At  the  close  of  the  day  the  draft  register  is  footed,  and  the  total  com- 
pared with  the  footing  of  the  draft  column  of  the  paying  teller's  daily 
check  sheet,  and  posted  to  the  remittance  register. 


^ruft    ^i 


£>rafts 


on 


eqtster 
(^/lemtcal  >^atlonal  cSi 


arik 


DATE 

CK.  i       NO. 

AMOUNT           1 

DATE 

V 

NO. 

AMOUNT 

/9_ 

f  6 
/  6 
/  6 

16 
/  6 
/  6 

/  6 
/6 
/6 
/  6 

326 
326 
327 
328 
32^ 
330 

760 
260 
600 

/  600 
760 

60 
^6 

66 

1 

/6 
/6 
/6 
/6 

336 
336 
337 
338 

220/ 

800 
608 
600 

80 
20 

f/^f 

^\ 

^260 

60 

S'&(j-. 

33/ 
332 
333 
33^ 

720 
280 
600 
700 

^0 
90 
60 

220/ 

80 

44  BOOKKEEPING 

Special  Agents  or  Correspondents A  bank  does  not  enter  into  busi- 
ness relations  with  every  individual  bank  from  which  checks  and  drafts 
may  be  received.  In  the  course  of  a  month  a  large  bank  would  have 
paper  for  collection  payable  at  many  hundred  banks  located  at  different 
points  throughout  the  country.  To  send  this  paper  to  the  various 
banks  upon  which  it  is  drawn  would  be  most  inconvenient  as  well  as 
expensive.  To  obviate  this,  banks  have  special  agents  or  correspondents 
located  at  convenient  centers  through  which  it  makes  its  collections. 
This  arrangement  simplifies  the  whole  business  of  collecting  paper  and 
reduces  the  correspondence  of  the  bank  to  a  minimum. 

We  have  this  day  made  the  following  remittances  to  out-of-town 
banks  for  credit.     (See  form  for  remittance  letter,  page  42.) 

To  Traders  National  Bank,  Buffalo. 

Check  of  Bates,  Torey  &  Co.,  dated  Feb.  26,  on  Second  National  Bank, 
Buffalo,  indorsed  by  Spencer,  Mead  &  Co.,  for  11340.20;  check  of  A.  B. 
Murray,  dated  Feb.  25,  on  Central  Bank,  Rochester,  indorsed  by  Manu- 
facturers and  Traders  Bank,  Philadelphia,  for  $1321.72 ;  draft  of  First 
National  Bank,  Worcester,  dated  Feb.  25,  on  Traders  National  Bank, 
Buffalo,  indorsed  by  Alliance  National  Bank,  Springfield,  for  $722.40. 

To  Bank  of  Commerce,  Baltimore. 

Check  of  F.  E.  Barry,  dated  Feb.  25,  on  Commercial  Bank,  Balti- 
more, indorsed  by  Spencer,  Mead  &  Co.,  for  $342.90 ;  check  of  M.  E. 
Gay,  dated  Feb.  24,  on  Bank  of  Commerce,  indorsed  by  Alliance  National 
Bank,  Springfield,  for  $142.16. 

To  Fourth  National  Bank,  Chicago. 

Check  of  A.  B.  Tonner,  dated  Feb.  23,  on  First  National  Bank, 
St.  Louis,  indorsed  by  Alliance  National  Bank,  Springfield,  for  $1721.95 ; 
check  of  D.  O.  Manning,  dated  Feb.  23,  on  Commercial  Bank,  Cincin- 
nati, indorsed  by  Farmers  Bank,  Albany,  for  $122.75 ;  check  of  F.  W. 
Wayne  &  Co.,  dated  Feb.  23,  on  Union  Bank,  Minneapolis,  Minn., 
indorsed  by  Farmers  Bank,  Albany,  for  $1420.50. 

To  Chemical  National  Bank,  New  York. 

Check  of  C.  E.  BoUes,  dated  Feb.  23,  on  Eliot  National  Bank, 
Poughkeepsie,  indorsed  by  Spencer,  Mead  &  Co.,  for  $1343.46 ;  check 
of  Morton  &  Mills,  dated  Feb.  21,  on  City  National  Bank,  Peekskill, 
indorsed  by  Thomas  Bennett  &  Co.,  for  $1325.62;  check  of  D.  E. 
Brown,  dated  Feb.  21,  on  Second  National  Bank,  Brooklyn,  indorsed 


BANKING  45 

by  Thomas  Bennett  &  Co.,  for  $1462.91;  check  of  Earl  &  Henderson, 
dated  Feb.  20,  on  Merchants  Bank,  Paterson,  indorsed  by  Thomas  Bennett 
&  Co.,  for  $142.10;  check  of  A.  B.  King,  dated  Feb.  24,  on  Rockland 
National  Bank,  Brooklyn,  indorsed  by  E.  L.  Howard,  for  $142.60. 

To  Alliance  National  Bank,  Springfield. 

Check  of  C.  W.  Gray,  dated  Feb.  24,  on  Bay  State  Bank,  Worcester, 
indorsed  by  C.  E.  Denison,  for  $1590.60  ;  check  of  C.  H.  Thurber,  dated 
Feb.  26,  on  A-lliance  National  Bank, Springfield,  indorsed  by  E.L.Howard, 
for  $1121.40  ;  check  of  W.  H.  Greeley,  dated  Feb.  24,  on  National  City 
Bank,  Northampton,  indorsed  by  E.  L.  Howard,  for  $24.16. 

To  Ninth  National  Bank,  Hartford. 

Check  of  Jones  Dairy  Co.,  dated  Feb.  23,  on  City  Bank,  Hartford, 
indorsed  by  E.  V.  Buckley  &  Son,  for  $621.40 ;  check  of  Oak  Grove 
Creamery  Co.,  dated  Feb.  23,  on  Citizens  Bank,  Torrington,  indorsed 
by  E.  V.  Buckley  &  Son,  for  $340. 

To  Chase  National  Bank,  Providence. 

Check  of  C.  F.  Gray,  dated  Feb.  21,  on  Second  National  Bank,  Provi- 
dence, indorsed  by  Fourth  National  Bank,  Chicago,  for  $1694.25 ; 
check  of  E.  C.  Delano,  dated  Feb.  21,  on  Union  Bank,  Providence, 
indorsed  by  Fourth  National  Bank,  Chicago,  for  $1500 ;  check  of  C.  A. 
Snow,  dated  Feb.  20,  on  Union  Bank,  Providence,  indorsed  by  Alliance 
National  Bank,  Springfield,  for  $1166.37. 

To  Farmers  Bank,  Albany. 

Check  of  F.  E.  Smith,  dated  Feb.  23,  on  Central  Bank,  Troy,  indorsed 
by  Fernald,  Son  &  Co.,  for  $1750 ;  check  of  Crescent  Mfg.  Co.,  dated 
Feb.  24,  on  Commercial  Bank,  Utica,  indorsed  by  W.  I.  Pratt,  for 
$1900. 

Enter  the  above  paper  in  the  remittance  register,  showing  each  item  in 
detail.  The  letters  containing  a  description  of  this  paper  are  sent  away, 
and  unless  we  take  a  copy  of  such  letters  we  have  nothing  to  show  in 
detail  the  amounts  of  our  remittances  from  time  to  time. 

The  note  teller  has  advised  you,  by  means  of  charge  tickets,  of  the 
following  debits  to  out-of-town  banks. 

Traders  National  Bank,  Buffalo,  note  for  $5000  (discount  No.  842) 
Traders  National  Bank,  Buffalo,  note  for  $7500  (discount  No.  866) 
Farmers  Bank,  Albany,  proceeds  of  collection  No.  650,  $723.25 
Farmers  Bank,  Albany,  proceeds  of  collection  No.  702,  $1198.80. 


46  BOOKKEEPING 

Enter  the  foregoing  items  in  the  remittance  register.     Consult  your 
instructor  if  necessary. 

Form  of  Charge  Ticket 


^Jhe  ^Jruders  .Rational  ^Jjank 

Boston,  >^ass.,       f'iuyi&  2,    /9 

Ghange 

7600 
7^6 

60 

S)tscount   Slerk 

On  a  line  with  the  last  item  entered  extend  the  balances  for  all  the 
accounts  in  the  remittance  register.  Note  particularly  the  two  columns 
for  balance.  The  debit  balances  are  written  on  the  left  and  the  credit 
balances  on  the  right  in  red  ink.     (See  model,  pages  40  and  41.) 

Present  your  remittance  register  to  your  instructor  for  approval. 

WORK  OF  THE   mDIVIDUAL  BOOKKEEPER 

The  work  of  this  clerk  is  to  be  found  in  the  individual  ledger. 

The  Individual  Ledger  contains  all  the  accounts  with  depositors.  It  is 
a  book  of  original  entry  for  the  various  cash  transactions  which  affect 
these  accounts,  the  entries  being  made  directly  from  the  deposit  tickets, 
checks,  charge  and  credit  tickets,  etc. 

The  names  of  the  depositors  should  be  written  in  alphabetical  order. 
Many  large  banks  have  a  line  of  depositors  that  they  can  count  upon 
as  regular  and  permanent,  and  in  such  cases  have  the  names  of  these 
depositors  printed  in  the  individual  ledger  when  the  book  is  made,  a  few 
blank  lines  being  left  after  each  letter  for  any  additional  accounts  which 
it  may  be  found  necessary  to  open  from  time  to  time. 

At  the  close  of  each  day's  business  the  columns  of  this  book  are 
footed  and  proved.  The  totals  of  the  Deposits  and  the  Total  Checks 
columns  are  transferred  daily  to  the  debit  and  credit  sides  of  the  general 


BANKING 


47 


cash  book,  crediting  and  debiting  Deposits.  The  total  of  the  Balance 
column  shows  the  total  amount  on  hand  to  the  credit  of  depositors  and 
should  at  all  times  agree  with  the  balance  of  the  account  with  deposits 
in  the  general  balance  ledger.      (See  page  96.) 


Individual  Ledger 

BALANCE 

MONDAY,  FEB.  15.  19_ 

TUESDAY,  FEB.  16.  19— 

NAME 

CHECKS  IN 

TOTAL 

DEPOSITS 

BALANCE 

CHECKS  in! 

TOTAL 

DEPOSITS 

BALANCE 

DETAIL 

CHECKS 

DETAIL    1 

CHECKS 

42 

16 

19 

20 

600 

Andrews,  E.  B. 

11258 

20 

110 
100 

500 

38 

171 

74 

150 

11236 

46 

1400 

16 

249 

40 
80 

2000 

9236 

46 

Bennett,  D.  W. 

12301 

85 

4C0 

ICOC 

1200 

12501 

85 

750 

278 

20 
10 

1010 

40 

2016 

40 

13501 

85 

Comer,  Geo.  A. 

6619 

99 

2400 

9019 

99 

721 
4000 

90 

1000 

1750 

9769 

99 

Ernst  Mfg.  Co. 

18044 

54 

4500 
10 

238 

07 
76 
49 

4500 

07 

175 
D1900 

90 

13720 

37 

258 
42 
12,5 

80 
11 
60 

4258 

80 

2129 

40 

11590 

97 

Freeman  &  Co. 

4812 

CO 

628 

70 

877 

95 

500 

6334 

C5 

720 

90 

225 

887 

71 

2887 

71 

8334 

65 

Goodwin  &  Co. 

121'J 

CO 

1219 

00 

75 
90 
124 

40 

39C 

829 

60 

Jennings,  C.  W. 

9216 

40 

750 
lOD 

750 

C500 

84CC 

40 

1125 

60 

1340 

2340 
CI  000 

50 

58 

9466 

90 

Moore,  Geo.  II. 

7216 

25 

9i;o 

50 

1000 

2500 

9216 

25 

42 
321 

60 

80 

D1200 

92 

11417 

75 

Rowell  &  T-ane 

621 

50 

150 
932 

10 

200 

175 

D1119 

40 

59G 

50 

250 
292 
500 

60 
10 

615 

18 

50 

Smith  &  Seanians 

7360 

90 

1250 

2212 

10 

1460 

7728 

20 

400 

1192 

10 

C192 

10 

6728 

20 

Wilson,  D.  O. 

6510 

50 

140C 

7910 

50 

7910 

50 

Certificates  of  Deposit 

750 

300 
500 

175C 

250C 

500 

500 

2000 

Certified  Checks 

240C 

700 

1500 

lOOC 

190C 

250 

25C 

1650 

Cashier's  Acct. 

— 

— 

V 

— 

15C0 

1500 

— 

— 

— 

1500 

v/ 

V 

V 

Total  Balances 

.S8332 

33 

12211 

m 

12211 

86 

17730 

JO 

93850 

II 

13450 

01^ 

13450 

01^ 

13517 

-51 

93936 

87 

Total  Overdrafts 

18 

50 

Net  Balances 

93918 

37 

The  accounts  in  the  individual  ledger  for  the  last  business  day  show 
the  following  balances. 

Decker  Bros.,  112,486.18  ;  Mace,  Gilmore  &  Co.,  $19,874.15  ;  Spencer, 
Mead  &  Co.,  $28,652.90;  D.  B.  Roberts,  1752.91;  E.  L.  Howard, 
111,216.94;  Fernald,  Son  &  Co.,  $21,724.92;  Thomas  Bennett  & 
Co.,  $12,172.41;   W.  I.  Pratt,   $7296.84;   D.  E.  Avery,  $15,162.40; 


48  BOOKKEEPING 

J.  H.  Crandall,  174,652.40  ;  C.  E.  Denison,  $16,240.90  ;  Freeman,  Austin 
&  Co.,  811,200.50;  C.  E.  Selover  &  Co.,  819,200 ;  Lane,  Rowell  &  Co., 
$37,500.06 ;  F.  E.  Sherman,  $12,172.45  ;  Wyckoff,  Seamans  &  Benedict, 
$77,314.31;  E.V.  Buckley  &  Son,  $24,214.93;  J.  O.  Baker,  $51,342.40  ; 
Powers  &  Sprague,  $15,294.63;  Janis,  Cooper  &  Tremper,  $37,582.69  ; 
Charles  J.  Kennedy,  $45,272.75  ;  Fields  Milling  Co.,  $14,352.90  ;  Certi- 
fied Checks,  $17,500;  Certificates  of  Deposit,  $5000;  Cashier's  Checks, 
$2000 ;  Total,  $590,180.57. 

Open  the  above  accounts  in  the  individual  ledger  in  alphabetical 
order,  one  account  to  a  line,  after  which  present  your  ledger  to  your 
instructor  for  approval. 

The  Individual  Bookkeeper's  Duties  may  be  briefly  referred  to  as  follows; 

1.  He  takes  charge  of  the  bank's  accounts  with  depositors. 

2.  He  meets  depositors  and  answers  questions  with  reference  to 

their  accounts. 

3.  He  writes  up  the  depositors'  pass  books. 

In  large  city  banks  there  are  frequently  many  thousand  accounts  with 
depositors,  and  the  individual  ledger  is  necessarily  subdivided,  a  section 
of  accounts  being  given  to  each  of  the  several  individual  bookkeepers 
employed. 

Note.  —  The  student  should  remember  that  the  assignment  of  work  to  the 
various  clerks  of  a  bank  would  necessarily  differ  with  different  banking  institutions. 
In  the  smaller  banks  one  clerk  would  fill  offices  that  in  larger  banks  would  be 
assigned  to  several  clerks,  while  in  the  largest  banks  of  the  country  the  work  of 
many  of  the  departments  would  be  subdivided  among  different  clerks. 

Transactions  for  the  Individual  Bookkeeper,  March  1 

The  individual  ledger  being  a  book  of  original  entry,  the  bookkeeper 
in  charge  of  this  department  usually  makes  the  entries  directly  from  the 
deposit  slips,  checks,  charge  and  credit  tickets,  etc.,  passed  on  to  him  by 
the  receiving  teller,  paying  teller,  note  teller,  and  correspondence  clerk. 

The  deposits  from  customers  for  to-day  may  be  found  in  the  Amount 
Credited  column  of  the  receiving  teller's  daily  check  sheet.  Enter  these 
deposits  in  the  Deposits  column  of  the  individual  ledger.  Place  a  check 
mark  by  the  side  of  the  customer's  account  on  the  receiving  teller's  sheet. 

The  note  teller  has  turned  over  credit  tickets  for  the  proceeds  of 
the  following  paper  collected  for  customers  to-day  :  Nos.  650,  702,  744, 
and  755. 

Enter  the  proceeds  of  these  collections  in  the  Deposits  column  of  the 
individual   ledger.     The   amounts    are    shown  by  the  records  in  the 


BANKING 


49 


collection  tickler.    Be  sure  to  deduct  all  collection  charges.    Check  the 
items  transferred. 

Straight  deposits  require  no  explanation  in  the  individual  ledger,  but 
discounts  and  collections  are  generally  designated  by  writing  D  and  C 
respectively  before  the  amounts.    (See  model  individual  ledger,  page  47.) 


Qommerciul    ^^atlonal    KJjartk 

en^dlt                                              ^Boston,  ^Mass,,       ^dy.    26,       79— 

NUMBER  OF 
COLLECTION 

ACCOUNT  TO  BE  CREDITED 

1 

1          PROCEEDS 

720 
6(f0 
7fO 

^62 

7/2 

8^/ 

60 
^0 
20 

jahw   /if.    CLvynyUZ&acL, 

Credit  tickets  have  also  been  received  from  the  note  teller  for  paper 
discounted  for  customers  to-day. 

Enter  the  proceeds  of  these  notes  in  the  Deposits  column  of  the  indi- 
vidual ledger.  Refer  to  the  discount  register  for  the  amounts.  Check 
the  items  transferred. 

The  total  of  the  checks  certified  for  to-day,  as  reported  by  the  paying 
teller,  is  12300.  Enter  the  amount  in  the  Deposits  column,  opposite 
Certified  Checks.     Check  the  amount  in  the  certified  check  book. 

Checks  of  depositors  have  been  received  by  the  paying  teller  and 
turned  over  to  the  individual  bookkeeper,  as  shown  in  the  Our  Bank 
column  of  the  paying  teller's  daily  check  sheet.  Enter  these  items  in 
the  Checks  in  Detail  column  of  the  individual  ledger  opposite  the  names 
of  the  drawers.    Check  the  items  transferred. 

Charge  tickets  have  been  received  from  the  paying  teller  on  account 
of  certified  checks.  Refer  to  the  certified  check  book  for  the  amounts 
of  these  tickets.  Enter  the  amounts  in  the  individual  ledger  the  same 
as  regular  checks.     Check  the  items  transferred. 

Checks  of  depositors  have  been  received  by  the  receiving  teller,  entered 
on  his  check  sheets,  and  turned  over  to  the  individual  bookkeeper.  A 
ist  of  these  checks,  with  the  names  of  the  drawers,  is  as  follows ; 


50  BOOKKEEPING 

Mace,  Gilmore  &  Co.,  $720.50,  $1500;  Decker  Bros.,  81250.20; 
Spencer,  Mead  &  Co.,  $340.20;  Fernald,  Son  &  Co.,  $72.60;  W.  I. 
Pratt,  $650.60;  F.  E.  Sherman,  $1625;  C.  E.  Denison,  $1750;  Thomas 
Bennett  &  Co.,  $200,  $1242.10;  E.  L.  Howard,  $40.50;  Charles  J. 
Kennedy,  $200,  $262.90. 

Enter  the  above  items  in  the  Checks  in  Detail  column. 

The  note  teller  has  turned  over  a  charge  ticket  for  discount  No.  889. 
Refer  to  the  discount  tickler  for  the  amount.    Check  the  item  transferred. 

The  following  depositors'  checks  have  come  in  from  the  clearing  house. 

D.  E.  Avery,  $625,  $127.52;  J.  O.  Baker,  $1275;  Thomas  Bennett 
&  Co.,  $2500  ;  E.  V.  Buckley  &  Son,  $115.40  ;  J.  H.  Crandall,  $462.50; 
Decker  Bros.,  $1200,  $750.42,  $500;  Freeman,  Austin  &  Co.,  $1750; 
E.  L.  Howard,  $75.40;  Charles  J.  Kennedy,  $400.60;  Mace,  Gilmore 
&  Co.,  $120,  $40.50;  D.  B.  Roberts,  $22.40;  WyckofP,  Seamans  & 
Benedict,  $167.50,  $125;  F.  E.  Sherman,  $750,  $211.40,  $600. 

Enter  the  above  in  the  Checks  in  Detail  column. 

The  correspondence  clerk  has  turned  over  the  depositors'  checks 
received  from  out-of-town  banks.  Enter  them  in  the  Checks  in  Detail 
column. 

Spencer,  Mead  &  Co.,  $650;  Fields  Milling  Co.,  $850;  Janis, 
Cooper  &  Tremper,  $560;  Lane,  Rowell  &  Co.,  $721.42;  Powers  & 
Sprague,  $1000. 

Extend  the  sum  of  the  checks  drawn  by  each  depositor  into  the 
Total  Checks  column  of  the  individual  ledger.  Foot  the  Checks  in  Detail, 
Total  Checks,  and  Deposits  columns.  The  sum  of  the  Total  Checks 
column  should  agree  with  the  sum  of  the  Checks  in  Detail  column. 
Determine  the  new  balance  to  the  credit  of  each  depositor  by  adding  the 
deposits  and  subtracting  the  total  checks  for  the  day.  Enter  the  new 
balance  in  the  Balance  column  for  March  1.     Foot  the  Balance  column. 

Prove  the  correctness  of  the  individual  ledger  as  follows : 

Add  the  total  deposits  for  to-day  to  the  total  balances  for  yesterday. 
From  this  sum  subtract  the  total  checks  for  to-day.  If  no  error  has 
been  made,  the  difference  so  found  should  be  the  same  as  the  total 
balances  for  March  1. 

Present  your  individual  ledger  to  your  instructor  for  approval. 

WORK  OF  THE   GENERAL   BOOKKEEPER 

The  records  of  the  general  bookkeeper  are  principally  found  in  the 
general  balance  ledger  and  general  cash  book. 


BANKING 


51 


The  General  Balance  Ledger  contains  a  summary  of  the  entire  operations 
of  the  bank,  systematically  collated  from  the  various  departments.  It 
is  provided  with  three  columns  for  each  business  day  in  the  week. 
The  first  column  contains  the  balances  of  the  various  accounts.  The 
debit  balances  are  written  in  black  ink,  and  the  credit  balances  in  red 
ink.  It  is  a  regular  double  entry  ledger;  therefore  the  total  of  the  red 
ink  balances  should  at  all  times  equal  the  total  of  the  black  ink  balances. 
The  next  two  columns  are  for  daily  debit  and  credit  additions  to  the 
accounts  in  this  ledger.  Among  the  advantages  of  this  form  of  ledger 
over  the  old  form  of  mercantile  ledgers  are : 

1.  It  furnishes  more  convenient  data  for  preparing  the  daily 

statement  of  the  bank. 

2.  It  requires  less  clerical  work. 

3.  It  serves  the  purpose  of  a  trial  balance. 

General  Balance  Ledger 


Monday,  Feb.  5,  19 

BALANCE 

DEBITS 

CREDITS 

BALANCE 

Cash 

281600 

28 

70605 

90 

58665 

90 

299690 

28 

Out-of-Town  Banks 

121200 

72 

75240 

10 

81240 

16 

115200 

72 

Bills  Discounted 

129640 

CO 

32500 

32129 

84 

130010 

46 

Redemption  Fund 

4500 

4500 

Furniture  and  Fixtures 

6000 

6000 

Premium  on  U.  S.  Bonds 

2000 

2000 

Real  Estate 

7500 

7500 

Expense 

240 

50 

04 

290 

04 

U.S.  Bonds 

100000 

100000 

Capital  Stock 

200000 

200000 

Circulation 

100000 

100000 

Collection  and  Exchange 

2002 

34 

120 

10 

3022 

44 

Deposits 

220008 

57 

72840 

10 

84840 

10 

242008 

57 

Surplus  Fund 

100000 

100000 

Undivided  Frofits 

12500 

75 

12500 

75 

Discount 

7350 

G4 

300 

10 

7659 

74 

052771 

30 

665191 

50 

652771 

30 

257296 

20 

257296 

20 

665191 

50 

The  General  Cash  Book  contains  a  record  of  all  amounts  affecting  the 
general  balance  ledger  of  the  bank.  Any  account  that  does  not  appro- 
priately belong  to  the  special  books  already  referred  to  is  recorded 
directly  in  this  book.  It  is  not  essentially  different  from  the  cash  book 
used  by    mercantile    houses.      The    left   side    is   provided    with   four 


52 


BOOKKEEPING 


General 


Monday, 


F 

ACCOUNT  AND  EXPLANATION 

COLLEC- 
TION AND 
EXCHANGE 

OUT-OF- 
TOWN 
BANKS 

GENERAL 

TOTALS 

Balance                                         On  hand 

162W0 

50 

3 

Bills  Discounted                          D.  T. 

12000 

v/ 

Alliance  Nat'l  Bank,  Springfield 

2400 

50 

^ 

Bank  of  Commerce,  Baltimore,  ISOO.w,  729.«» 

2529 

40 

\/ 

Farmers  Bank,  Albany,  200.oo,  821.oo 

1021 

>/ 

Fourth  Nat'l  Bank,  Chicago 

12000 

\/ 

Coll.  and  Exch.                           Disc.  R. 

72 

40 

3 

Interest  and  Discount                 Disc.  R. 

270 

50 

s/ 

Coll.  and  Exch.                            11.  Teller 

14 

50 

V 

Coll.  and  Exch.                            T.  Teller,  S.'-o,  11 .» 

14 

70 

y/ 

Coll.  and  Exch.                            C.  T.,  l.»,  2.oo,  i.:o 

4 

75 

3 
3 
3 

Deposits                                        I.  L. 

Coll.  and  Exch.                            Total  for  day 

Out-of-Town  Banks                     Total  for  day 

Is 

90 

178240 

lOG 

17950 

95 
35 
90 

208CC8 

lOG 

17950 

70 

371509 

20 

n 

11 

1 

columns,  one  for  collection  and  exchange,  one  for  receipts  from  banks, 
one  for  sundry  receipts,  and  one  for  totals.  The  right  side  is  pro- 
vided with  three  columns,  one  for  cash  remittances  to  banks,  one  for 
sundry  payments,  and  one  for  totals. 

The  difference  between  the  sides  of  this  book  should  at  all  times 
show  the  balance  of  cash  on  hand. 

The  General  Bookkeeper  in  a  largo  bank  occupies  a  position  of  special 
responsibility.  He  is  the  chief  accountant  of  the  bank,  all  the  work  in 
each  of  the  several  departments  coming  under  his  general  supervision. 
Upon  him  devolves  the  work  of  classifying  the  general  results  of  the 
bank  and  the  rendering  of  statements  required  by  the  board  of  directors 
and  by  the  regulations  of  the  bank. 

He  usually  has  personal  charge  of  the  general  cash  book  and  the 
general  balance  ledger. 

Transactions  for  the  General  Bookkeeper,  March  1 


The  general  balance  ledger  exhibited  the  following  balances  at  the 
close  of  Saturday,  Feb.  27, 


BANKING 


53 


Cash  Book 


Feb.  15,  19. 


F 

ACCOUNT  AND  EXPLANATION 

1    OUT-OF- 
1      TOWN 
BANKS 

GENERAL 

TOTALS 

3 

V 

Bills  Discounted 

Alliance  Nat'l  Bank,  Springfield 

Chemical  Nat'l  Bank,  N.Y.,  7240 .«>,  2500.oo 

Farmers  -Bank,  Albany 

Chase  Nat'l  Bank,  Providence,  120.«>,  4(X).<» 

Ninth  Nat'l  Bank,  Hartford 

Traders  Nat'l  Bank,  Buffalo,  2500.oo,  320.*" 

Disc.  n. 

1 

1 
7500 

9740 

7240 

520 

162 

2820 

50 
11 
50 
40 
40 

125C0 

3 
3 

Deposits 
Out-of-Town  Banks 

r  Paying  Teller's  Currency 

I.  L. 

Total  for  day 
166901.^^ 

152240 
27983 

95 
91 

192724 

27983 

91 

8C 

Balance  <    Clearing-House  Checks  on  hand 

112407^ 

178784 

34 

[^  Cash  Items  {City  and  Foreign)  on 

hand       642.^ 

-^-^^ 

= 

371509 

20 

Credit  Balances 


V 

Capital  Stock 

$400000. 

V 

Circulation 

200000. 

V 

Collection  and  Exchange 

21275.10 

V 

Deposits 

590180.57 

Interest  and  Discount 

16240.10 

Surplus  Fund 

100000. 

Undivided  Profits 
Loss  and  Gain 
Protest  Fees 

Debit  Balances 

6728.14 

V 

Cash 

$238995.66 

Bills  Discounted 

496722.60 

Protested  Paper 

V 

Out-of-Town  Banks 

273795.30 

Due  from  U.S.  Treasurer 

2000. 

V 

U.S.  Bonds  to  secure  Circulation 

200000. 

Salaries 

4750. 

Stocks  and  Bonds 

62500. 

\ 

Real  Estate 

27500. 

Redemption  Fund  with  the  U.S.  Treasurer 

10000. 

Furniture  and  Fixtures 

12625.50 

Premium  on  U.S.  Bonds 

4000. 

Expense 

214.96 

Taxes 

320. 

54  BOOKKEEPING 

Enter  the  above  balances  in  the  general  balance  ledger.  Write  the 
credit  balances  in  red  ink  and  the  debit  balances  in  black  ink.  When  the  accounts 
are  properly  opened  ascertain  if  the  footings  of  the  debits  and  credits 
are  equal.     Present  your  work  to  your  instructor  for  approval. 

Write  the  balance  of  cash  on  hand,  $238,995.66,  in  the  general  cash 
book.     (See  model,  pages  52  and  53.) 

In  practice  the  general  bookkeeper  would  have  before  him  charge  and 
credit  tickets,  letters,  etc.,  from  which  to  make  entries  in  the  general 
cash  book.  These  entries  are  generally  made  when  the  day's  trans- 
actions have  been  completed.  Then  all  the  tickets  can  be  assorted  so 
that  they  may  be  recorded  conveniently. 

The  debits  and  credits  for  the  general  cash  book  March  1  are  as 
follows : 

1.  From  the  discount  register  debit  Bills  Discounted  for  the  total 
of  the  Amount  of  Paper  column,  and  credit  Collection  and  Exchange  for 
the  total  of  the  Collection  and  Exchange  column,  and  Interest  and  Dis- 
count for  the  total  of  the  Interest  and  Discount  column.  Properly  check 
these  totals  in  the  discount  register. 

2.  From  the  discount  tickler  credit  Bills  Discounted  for  the  total  of  the 
Amount  to  he  Collected  column.     Properly  check  the  item  transferred. 

3.  From  the  remittance  register  credit  the  several  banks  for  the 
amounts  in  the  Credits  column,  and  debit  them  for  the  amounts  in  the 
Charges  column.     Properly  check  the  items  transferred. 

If  there  is  more  than  one  item  in  the  debit  or  the  credit  column,  short 
extend  the  amounts  in  the  general  cash  book. 

4.  From  the  individual  ledger  credit  Deposits  for  the  total  of  the 
Deposits  column,  and  debit  Deposits  for  the  total  of  the  Total  Checks 
column.     Properly  check. 

5.  From  the  collection  tickler  credit  Collection  and  Exchange  for 
our  collection  charges  on  Nos.  650  and  702. 

6.  Fro::i  the  receiving  teller's  daily  check  sheet  credit  Collection 
and  Exchange  for  the  total  of  the  Collection  and  Exchange  column. 
Properly  check. 

7.  From  the  paying  teller's  daily  check  sheet  debit  Expense  for  the 
total  of  the  Expense  column,  and  credit  Collection  and  Exchange  for 
the  totals  of  the  Sundry  Collection  and  Exchange  and  Exchange  columns. 
Properly  check. 

Prove  the  cash.  The  amount  of  bills  and  coin  on  hand  is 
1258,884.32.  Clearing-house  items  on  hand  amount  to  $26,205. 
Cash  items  (city  and  foreign)  on  hand  amount  to  $11,623. 


( 


BANKING  55. 

Rule  and  foot  the  general  cash  book.  Proceed  carefully  and  make 
absolutely  no  errors.  Study  the  model  given  on  pages  52  and  53. 
Before  bringing  down  your  balance  for  Tuesday,  March  2,  present  your 
general  cash  book  to  your  instructor  for  approval  and  suggestions. 

Post  the  general  cash  book  to  the  general  balance  ledger.  Post  only 
the  totals  of  the  Collection  and  Exchange  and  Out-of-Town  Banks 
columns.  Debit  Cash  in  the  general  balance  ledger  for  the  total 
receipts,  and  credit  it  for  the  total  payments  for  the  day. 

Foot  the  D'ehit  and  Credit  columns  of  the  general  balance  ledger.  If 
correct,  they  should  agree.  Determine  the  new  balances  in  the  general 
balance  ledger.  Foot  these  new  balances.  If  correct,  the  red  and 
black  ink  totals  should  agree. 

Compare  your  balance  ledger  with  the  model  given  on  page  51,  and 
see  if  anything  remains  to  be  done.  If  not,  present  all  your  books  to 
your  instructor  for  criticism. 

Transactions  for  the  Discount  Clerk,  March  2 

The  following  paper  has  been  offered  and  accepted  for  discount. 
Make  proper  records  for  it  in  the  discount  register.  Deduct  the  dis- 
count for  the  time  notes  have  to  run. 

No.  925.  Note  of  Boyd  Bros.,  at  60  days  from  Jan.  31,  discounted 
for  F.  E.  Sherman,  payable  at  Manufacturers  and  Traders  Bank,  Phila- 
delphia, for  .'117,250.  Collection  and  exchange,  $17.50.  Proceeds 
credited. 

No.  926.  Note  of  Peterson  Bros.  &  Co.,  at  three  months  from 
Jan.  1,  discounted  for  D.  B.  Roberts,  payable  at  Fourth  National 
Bank,  Chicago,  for  $11,390.  Collection  and  exchange,  111.50.  Pro- 
ceeds credited. 

No.  927.  Note  of  C.  P.  Jameson,  at  15  days  from  March  1,  indorsed 
by  Janis,  Cooper  &  Tremper,  discounted  for  D.  E.  Avery,  payable  at 
our  bank,  for  $9275.80.     Proceeds  credited. 

No.  928.  Note  of  A.  P.  Littlo  &  Co.,  at  30  days  from  Feb.  23, 
indorsed  by  Merrill  &  Co.,  discounted  for  Fields  Milling  Co.,  payable 
at  First  National  Bank,  Worcester,  for  $6290.  Collection  and  exchange, 
$6.30.     Proceeds  credited. 

No.  929.  Note  of  W.  I.  Pratt,  at  30  days  from  March  2,  payable  at 
Merchants  Bank,  Torrington,  Conn.,  indorsed  by  Wells,  Osborn  &  Co., 
discounted  for  Charles  J.  Kennedy,  for  $12,795.  Collection  and 
exchange,  $12.75.     Proceeds  credited. 


56  BOOKKEEPING 

No.  930.  Note  of  Powers  and  Sprague,  at  30  days  from  Feb.  24, 
discounted  for  Thomas  Bennett  &  Co.,  payable  at  our  bank,  for  13275. 
Proceeds  credited. 

No.  931.  Note  of  W.  V.  Brown,  at  30  days  from  Feb.  27,  discounted 
for  Spencer,  Mead  &  Co.,  payable  at  our  bank,  for  $1500.  Proceeds 
credited. 

Rule  and  foot  the  discount  register.  Prove  the  footings  as  explained 
at  the  close  of  discount  clerk's  work  March  1. 

Post  the  entries  from  the  discount  register  to  the  discount  tickler. 
Follow  instructions  to  the  discount  clerk  March  1.  Be  sure  to  properly 
check  all  items  transferred. 

Transactions  for  the  Collection  Clerk,  March  2 

The  following  is  a  list  of  paper  received  for  collection  to-day.  Enter 
it  in  the  collection  register. 

No.  806.  Note  signed  by  D.  Appleton  &  Co.,  dated  Feb.  8,  at  30 
days,  indorsed  by  C.  W.  Ellis,  payable  at  our  bank,  for  $7200.  To  be 
collected  for  Ninth  National  Bank,  Hartford. 

No.  807.  Note  signed  by  Scott  &  Lucas,  payable  two  months  from 
Jan.  4,  at  Park  Square  National  Bank,  City,  for  $5162.50.  To  be  col- 
lected for  Fourth  National  Bank,  Chicago. 

No.  808.  Note  signed  by  Fanning  &  Cook,  payable  in  60  days  from 
Jan.  4,  at  Union  Trust  Co.,  City,  for  $2750.  To  be  collected  for  Bank 
of  Commerce,  Baltimore. 

No.  809.  Draft  dated  Jan.  8,  at  60  days  from  date,  on  Trenholm  Bros., 
payable  at  Briggs  Bank,  Westfield,  for  $2152.90.  To  be  collected  for 
Farmers  Bank,  Albany. 

No.  810.  Draft  dated  Jan.  8,  at  60  days  from  date,  on  W.  S.  Stanton, 
Springfield,  for  $1500.  To  be  collected  for  Fourth  National  Bank, 
Chicago. 

No.  811.  Sight  draft  dated  March  2,  on  Taylor  Bros.,  City,  in  favor  of 
Powers  &  Sprague,  payable  at  our  bank,  for  $1950.  To  be  collected 
for  Powers  &  Sprague. 

No.  812.  Sight  draft  dated  March  2,  on  William  Sloan  &  Son,  Pough- 
keepsie,  in  favor  of  Lane,  Rowell  &  Co.,  for  $2750.  To  be  collected  for 
Lane,  Rowell  &  Co. 

No.  813.  Sight  draft  dated  March  3,  drawn  on  E.  C.  Baldwin,  Spring- 
field, in  favor  of  E.  L.  Howard,  for  $1357.60.  To  be  coUected  for 
E.  L.  Howard. 


BANKING  57 

No.  814.  Note  of  David  Wells,  at  30  days  from  Feb.  16,  with 
interest  at  6%,  payable  at  our  bank,  for  $750.  To  be  collected  for 
J.  H.  Crandall. 

Compute  the  interest  on  the  $750  for  30  days.  Add  this  interest  to 
the  face  of  the  note  and  write  the  total  in  the  Amount  column  of  the 
collection  register.    This  should  be  done  with  all  interest-bearing  paper. 

No.  815.  Note  of  L.  F.  Chappell,  payable  at  Fourth  National  Bank, 
Chicago,  at  three  months  from  Jan.  1,  for  11250.  To  be  collected  for 
Thomas  Bennett  &  Co. 

No.  816.  Note  of  W.  B.  Burdick,  at  two  months  from  Jan.  27,  with 
interest,  payable  at  Merchants  Bank,  St.  Louis,  Mo.,  for  $2790.  To 
be  collected  for  Thomas  Bennett  &  Co. 

No.  817.  Sight  draft  dated  March  2,  on  Bradley  &  Co.,  Buffalo,  N.Y., 
[for  1290.50.     To  be  collected  for  Thomas  Bennett  &  Co. 

No.  818.  Sight  draft  dated  March  1,  on  Winslow  &  Co.,  Rochester, 
[N.Y.,  for  $375.62.     To  be  collected  for  Decker  Bros. 

Post  the  collection  register  to  the  collection  tickler.  (See  instructions 
to  collection  clerk,  March  1.) 

Transactions  for  the  Receiving  Teller,  March  2 

The  following  are  the  regular  deposits  for  to-day.  Enter  them  on 
the  receiving  teller's  daily  check  sheet. 

Wyckofe,  Seamans  &  Benedict,  V  $1600,  V  $562,  B  $2500,  B  $750, 
B  $12,200. 

Spencer,  Mead  &  Co.,  V  $1740,  V  $190,  #61  $400,  #4  $800,  #16 
$1290. 

D.  E.  Avery,  B  $14,270,  B  $640.70,  X  $1162.95,  X  $1436.52, 
X  $1349.20;  less  collection,  $4.15. 

J.  O.  Baker,  V  $11,400,  V$45,  B  $1600,  B  $9250,  B  $5450,  x  $1400; 
[less  collection,  $1.40. 

Thomas  Bennett  &  Co.,  V  $240,  V  $60,  #7  $1950,  #9  $2325,  #15 
^600,  O  $400. 

J.  H.  Crandall,  X  $2400,  X  $1500;  less  collection,  $4. 

Decker  Bros.,  V  $3700,  B  $5210,  O  $900,  x  $4500,  less  collec- 
^tion,  $4.50. 

Freeman,  Austin  &  Co.,  #  21  $2145,  #  27  $1360. 

E.  L.  Howard,  V  $2400,  B  $3262.90,  B  $3040.50,  B  $6200. 
Janis,  Cooper  &  Tremper,  V  $1500,  B  $1100,  B  $2400,  #  3  $1140.60, 

[#27  $11,000. 


58  l^OOKKEEPING 

Charles  J.  Kennedy,  #17  f2410,  v/ $4000,  x  '^1621.40;  less  collec- 
tion, li'l.GS. 

Mace,  Gilmore  &  Co.,  O  '$1100,  B  f6270,  x  11125.60,  #25  -$1460, 
#31  $1652;  less  collection,  $1.25. 

Foot  the  columns  of  the  receiving  teller's  daily  check  sheet.  Make 
out  Recapitulation  and  Proof  blank.  Balance  on  hand:  coin,  $712; 
bills,  $18,000.  You  have  given  to  the  paying  teller  during  the  day 
$8725.  The  debit  and  credit  sides  of  y^ur  proof  should  always  balance 
if  the  work  is  correct. 

Transactions  for  the  Paying  Teller,  March  2 

The  following  are  lists  of  checks  paid  by  the  paying  teller  to-day. 
Enter  them  on  the  paying  teller's  daily  check  sheet. 

1.  Checks  on  our  bank: 

Wyckoff,  Seamans  &  Benedict  (New  York  draft),  $14,260  ;  Spencer, 
Mead  &  Co.  (New  York  draft),  $4500  ;  F.  E.  Sherman  (New  York  draft), 
$3762.50;  D.  B.  Roberts  (New  York  draft),  $1000;  Powers  &  Sprague, 
$7265;  W.  I.  Pratt,  $1217.50  ;  Mace,  Gilmore  &  Co.,  $8290  ;  Charles 
J.  Kennedy,  $400;  E.  L.  Howard,  $350;  Freeman,  Austin  &  Co., 
$2790;  Fields  Milling  Co.  (New  York  draft),  $1400. 

2.  Checks  on  clearing-house  banks : 

Bunker  Hill  National  Bank,  $1940 ;  Suffolk  National  Bank,  $1875 
Colonial   National   Bank,   $2750.06;    Shoe  &   Leather  Bank,  $2500 
Third    National   Bank,   $400;    Metropolitan    National   Bank,   $1700 
Park    Square   National    Bank,    $3400.60 ;    Citizens    National    Bank, 
$6250.50;    Eliot    National    Bank,    $4000;     New    England    National 
Bank,  $3257. 

3.  Checks  on  out-of-town  banks  : 

Traders  National  Bank,  Buffalo,  $17,500,  $750,  and  $1600;  collec- 
tion, $19.85.  Bank  of  Commerce,  Baltimore,  $400,  $1450,  and  $1725; 
collection,  $3.60.  Manufacturers  and  Traders  Bank,  Philadelphia, 
$8500;  collection,  $8.  Fourth  National  Bank,  Chicago,  $4685;  col- 
lection, $4.75.  Chase  National  Bank,  Providence,  $4500.50 ;  collec- 
tion, $4.50.  Ninth  National  Bank,  Hartford,  $3250;  collection,  $3.25. 
Chemical  National  Bank,  New  York,  $1100,  $2500,  $1650,  $9250; 
collection,  $14.50.  Eliot  National  Bank,  Springfield,  $4792.50 ;  collec- 
tion, $4.60. 

4.  Checks  on  banks  in  our  city  not  members  of  the  clearing  house : 
Powers  Bank,  $172.50;  Union  Trust  Co.,  $150. 


BANKING  59 

Sold  the  following  drafts  on  Chemical  National  Bank,  New  York. 

1.  Sold  for  check : 

Wyckoff,  Seamans  &  Benedict,  $14,260;  exchange,  114.25.  Spencer, 
Mead  &  Co.,  $4500  ;  exchange,  |4.50.  D.  B.  Roberts,  $1000  ;  exchange, 
II.  Fields  Milling  Co.,  $1400;  exchange,  $1.40.  F.  E.  Sherman, 
$3762.50;  exchange,  $3.75. 

Note.  —  The  exchange  items  on  the  above  drafts  were,  in  this  instance,  paid  in 
cash.  The  record  on  the  paying  teller's  sheet  will  be  identically  the  same  as  where 
these  items  are  covered  by  check.  By  referring  to  the  checks  covering  these  drafts 
on  the  left  side  of  the  sheet  it  will  be  seen  that  the  amounts  entered  are  for  the  face 
of  the  drafts  only. 

2.  Sold  for  cash: 

A.  L.  Hopkins,  $2000;  exchange,  $1.  T.  Y.  Smith,  $1500; 
exchange,  75^. 

Certified  the  following  checks.     Enter  them  in  the  certified  check  book. 

Lane,  Rowell  &  Co.,  $11,250 ;  Charles  J.  Kennedy,  $7295 ;  Decker 
Bros.,  $1254;  J.  O.  Baker,  $9265. 

Pay  cashier's  charge  tickets  for  the  following  items : 

Postage,  $12.50  ;  stationery,  etc.,  $25.90  ;  blank  books,  $142.60. 

The  items  for  the  Sundry  Receipts  column  are  as  follows : 

Bills  and  coin  from  yesterday's  proof,  $237,804.92 ;  bills  and  coin 
received  from  the  receiving  teller  at  the  close  of  yesterday's  business, 
$11,747.25;  bills  and  coin  received  from  the  receiving  teller  during  the 
day,  $8725;  bills  and  coin  received  from  the  note  teller  at  the  close  of 
yesterday's  business,  $9332.15;  received  from  the  clearing  house  for 
to-day's  exchanges,  $28,349.17. 

Add  the  columns  of  the  paying  teller's  daily  check  sheet.  Make  out 
Recapitulation  and  Proof  blank.  A  careful  count  of  the  cash  now  on 
hand  under  various  heads  (subdivisions  of  bills  and  coin  only)  shows 
an  amount  of  $187,006.03.     Foot  the  certified  check  book. 

Transactions  for  the  Note  Teller,  March  2 

Make  the  proper  records  in  the  discount  tickler  for  the  paper  disposed 
of  to-day.     In  the  Remarks  column  write  : 

For  No.  902,  Charged  Alliance  National  Bank. 

For  No.  869,  Charged  Alliance  National  Bank. 

For  No.  868,  Paid,  S/2. 

For  No.  895,  Charged  Farmers  Bank. 

For  No.  867,  Paid,  3/2. 


60  BOOKKEEPING 

Rule  and  foot  the  discount  tickler. 

Advices  have  been  received  that  the  following  collections  have  been 
paid.  Make  records  in  the  collection  tickler  for  these  collections.  In 
the  Remarks  column  write : 

For  No.  723,  Charged  to  Chemical  National  Bank.     Bank's  col- 
lection, $1;  our  collection,  ^1.10. 
For  No.  726,  Charged  to  Chase  National  Bank.    Bank's  collection, 

$If;  our  collection^  $5, 
For  No.  742,  Charged  to  Chase  National  Bank.    Bank's  collection, 

$5;  our  collection,  $5.20. 
For  No.  743,  Charged  to  Bank  of  Commerce,  Baltimore.    Bank's 
collection,  $1;  our  collection,  $1.25. 
Collections  Nos.  756,  800,  and  811  have  been  paid.     In  the  Remarks 
column  of  the  collection  tickler  write : 
For  No.  756,  Paid, 
For  No.  800,  Paid, 
For  No.  811,  Paid, 


Transactions  for  the  Correspondence  Clerk,  March  2 

This  morning's  mail  contained  the  following  remittances  from  the 
banks  named,  for  credit.     Enter  in  the  remittance  register. 

Traders  National  Bank,  Buffalo  $9273.40 

Bank  of  Commerce,  Baltimore  4213.93 

Manufacturers  and  Traders  Bank,  Philadelphia  5272.50 

Fourth  National  Bank,  Chicago  6395.40 

Ninth  National  Bank,  Hartford  5427.30 

Chase  National  Bank,  Providence  8216.50 

Farmers  Bank,  Albany  5324.80 

Alliance  National  Bank,  Springfield  4152.70 

The  following  are  the  drafts  drawn  on  Chemical  National  Bank,  New 
York,  as  per  stubs  in  the  draft  book. 

No.  484,  114,260 ;  No.  435,  $4500 ;  No.  436,  $3762.50 ;  No.  437, 
$1500;  No.  438,  $1000;  No.  439,  $2000;  No.  440,  $1400.  Enter 
these  drafts  in  the  draft  register.  Credit  Chemical  National  Bank  in 
the  remittance  register  for  the  total. 

We  have  this  day  made  the  following  remittances  to  out-of-town  banks 
for  collection.  In  the  To  Whom  Sent  column  of  the  collection  tickler 
write  the  name  of  the  bank  to  which  the  paper  is  sent.     No  other  record 


BANKING 


61 


is  needed  at  this  time.  Nos.  804,  805,  809,  810,  813,  sent  to  Alliance 
National  Bank,  Springfield;  No.  812  sent  to  Farmers  Bank,  Albany; 
Nos.  815  and  816  sent  to  Fourth  National  Bank,  Chicago;  Nos.  817 
and  818  sent  to  Traders  National  Bank,  Buffalo. 

Form  of  Letter  to  accompany  Paper  remitted  for  Collection  and  Credit 


C.  H.  THURBER,  PRESIDENT                                                                                                                             J.  W.  MACE,  VICE   PRESIDENT 

CHAS.  W.  HAMILTON,  CASHIER 

MERCHANTS  NATIONAL  BANK 

Boston,  Mass.,     SeA.  d,     I9_ 

€.  W-.  S>&aA(>d^,  Esq.,  Cashier 

cAeAA^  yanJc  (^IXa^ 
Dear  Sir, —  I  inclose  for  collection  and  credit  the  itcnis  stated  below. 

NO. 

PAYER 

AMOUNT 

720 
6(^0 
7ff 

fcyulom.,  7J'HvQ.k  V  ^. 

72^0 

^72 

f26f 

16 

Please  advise  us  of  the  payment  of  the  items  inclosed.     Paper  not  paid  at 
maturity  should  be  returned  to  us  at  once. 

Very  respectfully  yours 

^kcM^.  Zi^.  /"foAmltcyyi,  Cashier 

We  have  this  day  made  the  following  remittances  to  out-of-town  banks 
for  credit.     Enter  them  in  the  remittance  register. 

To  Chemical  National  Bank,  New  York. 

Check  of  C.  W.  Ellis,  dated  Feb.  26,  on  Ninth  National  Bank,  Brook- 
lyn, indorsed  by  E.  L.  Brown,  for  fllOO;  check  of  Daniel  L.  Coon, 
dated  Feb.  25,  on  Union  Bank,  Peekskill,  indorsed  by  C.  W.  Gray,  for 


62  BOOKKEEPING 

$2500;  check  of  D.  A.  McMillan,  dated  Feb.  24,  on  Union  Bank, 
Peekskill,  indorsed  by  Bailey  &  Bailey,  for  $1650 ;  check  of  Arthur 
R.  Briggs  &  Co.,  dated  Feb.  24,  on  Second  National  Bank,  Brooklyn, 
indorsed  by  Novelty  Mfg.  Co.,  for  $9250  ;  check  of  Brown  Bros.,  dated 
Feb.  23,  on  Second  National  Bank,  Brooklyn,  indorsed  by  D,  E.  Avery, 
for  $1162.95  ;  check  of  Wilson  &  Co.,  dated  Feb.  25,  on  Second  National 
Bank,  Brooklyn,  indorsed  by  D.  E.  Avery,  for  $1436.52. 

To  Farmers  Bank,  Albany. 

Check  of  Hillis  Mfg.  Co.,  dated  Feb.  25,  on  Farmers  Bank,  indorsed 
by  Temple  &  Co.,  for  $1500 ;  check  of  R.  E.  Porter,  dated  Feb.  24,  on 
Commercial  Bank,  Troy,  indorsed  by  D.  E.  Avery,  for  $1349.20;  check 
of  Garson  &  Myers,  dated  Feb.  25,  on  Merchants  Bank,  Utica,  indorsed 
by  J.  O.  Baker,  for  $1400. 

To  Chase  National  Bank,  Providence. 

Check  of  Warren  &  Sprague,  dated  Feb.  24,  on  Second  National 
Bank,  Providence,  indorsed  by  J.  H.  Crandall,  for  $1500  ;  check  of  J.  M. 
Evans,  dated  Feb.  23,  on  Union  Bank,  Providence,  indorsed  by  J.  H. 
Crandall,  for  $2400  ;  check  of  Whitman  &  Smith,  dated  Feb.  24,  on  Chase 
National  Bank,  Providence,  indorsed  by  Brown  Bros.,  for  $4500.50. 

To  Ninth  National  Bank,  Hartford. 

Check  of  E.  L.  Conway  &  Co.,  dated  Feb.  23,  on  City  Bank,  Hart- 
ford, indorsed  by  Decker  Bros.,  for  $4500 ;  check  of  Wheeler  Mfg.  Co., 
dated  Feb.  23,  on  Fourth  National  Bank,  Hartford,  indorsed  by  Dorman 
&  Co.,  for  $3250;  check  of  Freeman  &  Co.,  dated  Feb.  24,  on  Ninth 
National  Bank,  indorsed  by  Briggs,  Slote  &  Co.,  for  $3250. 

To  Alliance  National  Bank,  Springfield. 

Check  of  Wheeler  &  Wilson,  dated  Feb.  25,  on  Eliot  National  Bank, 
Springfield,  indorsed  by  Fulton  Boiler  Works,  for  $4792.50 ;  check  of 
Salisbury  &  Gray,  dated  Feb.  24,  on  National  City  Bank,  Northampton, 
indorsed  by  Charles  J.  Kennedy,  for  $1621.40 ;  check  of  E.  L.  Howard, 
dated  Feb.  23,  on  Bay  State  Bank,  Worcester,  indorsed  by  Traders 
National  Bank,  Buffalo,  for  $1324.40 ;  check  of  Simpson  &  Frey,  dated 
Feb.  23,  on  Bay  State  Bank,  Worcester,  indorsed  by  Traders  National 
Bank,  Buffalo,  for  $1142.60. 

To  Fourth  National  Bank,  Chicago. 

Check  of  Jones  Dairy  Co.,  dated  Feb.  24,  on  Fourth  National  Bank, 
indoi-sed  by  D.  W.  Manning  &  Son,  for  $4685  ;  check  of  Raymond  & 


BANKraG  63 

Son,  dated  Feb.  24,  on  First  National  Bank,  St.  Louis,  indorsed  by 
Alliance  National  Bank,  Springfield,  for  $1427.52  ;  check  of  Armour  & 
Co.,  dated  Feb.  23,  on  Commercial  Bank,  Cincinnati,  indorsed  by  Chase 
National  Bank,  Providence,  for  13142.50. 

To  Traders  National  Bank,  Buffalo. 

Check  of  R.  H.  White  &  Co.,  dated  Feb.  25,  on  Traders  National 
Bank,  indorsed  by  Mason  &  Hamlin,  for  $1600;  check  of  E.  W.  Bloser, 
dated  Feb.  '24,  on  Traders  National  Bank,  indorsed  by  A.  J.  Graham, 
for  $750 ;  check  of  Cushman  Bros.,  dated  Feb.  23,  on  Traders  National 
Bank,  for  $17,500 ;  check  of  A.  L.  Gilbert,  dated  Feb.  23,  on  Com- 
mercial B.ank,  Rochester,  N.Y.,  indorsed  by  Alliance  National  Bank, 
Springfield,  for  $372.70. 

To  Bank  of  Commerce,  Baltimore. 

Check  of  J.  W.  Walker,  dated  Feb.  24,  on  Bank  of  Commerce, 
indorsed  by  Mason  &  Hamlin,  for  $400  ;  check  of  J.  E.  Seaver,  dated 
Feb.  23,  on  Bank  of  Commerce,  indorsed  by  Mason  &  Hamlin,  for 
$1450;  check  of  H.  G.  Healey,  dated  Feb.  24,  on  Bank  of  Commerce, 
indorsed  by  D.  E.  Avery,  for  $1725;  check  of  J.  A.  Kinsley,  dated 
Feb.  23,  on  Union  Bank,  Washington,  indorsed  by  Chase  National  Bank, 
Providence,  for  $4126.30 ;  check  of  D.  Appleton  &  Co.,  dated  Feb.  23, 
on  Central  National  Bank,  Paterson;  N.  J.,  indorsed  by  Fourth  National 
Bank,  Chicago,  for  $3162.50;  check  of  Charles  H.  Dean,  dated  Feb.  25, 
on  Bank  of  Commerce,  indorsed  by  W.  I.  Pratt,  for  $1300. 

To  Manufacturers  and  Traders  Bank,  Philadelphia. 

Draft  of  Union  Bank,  Schenectady,  dated  Feb.  23,  on  First  National 
Bank,  Philadelphia,  indorsed  by  J.  H.  Crandall,  for  $700.50  ;  draft  of 
Commercial  Bank,  Albany,  dated  Feb.  21,  on  Manufacturers  and 
Traders  Bank,  indorsed  by  Taylor  Bros.,  for  $8500. 

Letters  requesting  Immediate  Returns.  —  When  paper  is  sent  for 
collection  to  out-of-town  banks  that  are  not  our  regular  agents  or  corre- 
spondents, it  is  usually  accompanied  by  letters  asking  for  immediate 
returns.      The  model  on  page  64  is  suggestive  of  the  form  of  letter  used. 

The  note  teller  has  advised  you,  by  means  of  charge  tickets,  of  the 
following  debits  to  out-of-town  banks.  Enter  these  items  in  the  remit- 
tance register. 

Alliance  National  Bank,  Springfield,  for  discount  No.  902,  $18,500 ; 
Alliance  National  Bank,  Springfield,  for  discount  No.  869,  $32,400; 


L 


64 


BOOKKEEPING 


Farmers  Bank,  Albany,  for  discount  No.  895,  $28,890 ;  Chemical 
National  Bank,  New  York,  for  the  proceeds  of  collection  No.  723, 
$1004.25 ;  Chase  National  Bank,  Providence,  for  the  proceeds  of 
collection  No.  726,  $4896;  Chase  National  Bank,  Providence,  for  the 
proceeds  of  collection  No.  742,  $5195 ;  Bank  of  Commerce,  Baltimore, 
for  the  proceeds  of  collection  No.  743,  $1249. 

Letter  requesting  Immediate  Returns 


W.  J.   MILLER,   President                                                                               J.   H.   MERRILL,   Vice  President 

D.    M.  GOSNELL,   Cashier 

The  Commercial  National  Bank  • 

Boston,  Mass.,    S'eA.  7,     19 
Mr.  W-.  d.  f-fvYiAyvouyv,  Cashicr 

Dear    Sir,  — I    inclose    for    COLLECTION    and    RETURNS    the 
paper  listed  below. 

NUMBER 

PAYER 

AMOUNT 

6^2 

la.    /if,    ^iemmAf   V  ^. 
Roo^eA>-dt  V   ^cyyi 

7/S 

70 
60 

Unless  otherwise  instructed,  properly  protest  and  return  to  us  at  once 
all  paper  not  paid  in  due  course. 

Yours  very  truly 

3.  m.  ^omveR,  Cashier 

The  note  teller  has  also  advised  you  that  collection  No.  756 
has  been  paid  and  credited  to  Farmers  Bank,  Albany,  at  its  face, 
$79.23. 

Extend  the  balances  on  the  remittance  register  as  explained  March  1. 

Present  your  remittance  register  to  your  instructor  for  approval. 


BANKING  65 


Transactions  for  the  Individual  Bookkeeper,  March  2 

Enter  the  deposits  from  customers  in  the  individual  ledger.  The 
amounts  are  found  on  the  receiving  teller's  daily  check  sheet. 

The  note  teller  has  turned  over  credit  tickets  for  the  proceeds  of  the 
following  collection  paper  collected  for  depositors  to-day:  Nos.  723, 
726,  742,  743,  800,  and  811.  Enter  the  proceeds  of  these  collections 
in  the  Deposits  column  of  the  individual  ledger  as  explained  March  1. 

Credit  tickets  have  also  been  received  from  the  note  teller  for  paper 
discounted  for  customers  to-day.  Enter  the  proceeds  of  these  notes  to 
the  credit  of  depositors  in  the  individual  ledger. 

The  total  of  checks  certified  to-day  as  reported  by  the  paying  teller 
is  $29,064.  Enter  to  the  credit  of  Certified  Checks  as  explained 
March  1. 

Checks  of  depositors  have  been  received  by  the  paying  teller  and 
turned  over  to  the  individual  bookkeeper  as  shown  on  the  paying 
teller's  daily  check  sheet.  Enter  these  items  in  the  individual  ledger 
as  explained  March  1. 

Charge  tickets  have  been  received  from  the  paying  teller  on  account 
of  certified  checks.  Refer  to  the  certified  check  book  for  the  amounts 
and  enter  them  in  the  individual  ledger. 

Checks  of  depositors  have  been  received  by  the  receiving  teller, 
entered  on  his  check  sheet,  and  turned  over  to  the  individual  book- 
keeper. A  list  of  these  checks  with  the  names  of  the  drawers  is  given 
below.     Enter  these  items  in  the  individual  ledger. 

Wyckoff,  Seamans  &  Benedict,  $6200,  $2400 ;  Mace,  Gilmore  & 
Co.,  $1100;  F.  E.  Sherman,  $3262.90;  C.  E.  Selover  &  Co.,  $3040.50; 
J.  O.  Baker,  $6270,  $5210;  Thomas  Bennett  &  Co.,  $5450;  E.  V. 
Buckley  &  Son,  $9250;  Powers  &  Sprague,  $1600;  Lane,  Rowell  & 
Co.,  $14,270,  $640.70-  Fernald,  Son  &  Co.,  $12,200;  Spencer,  Mead 
&  Co.,  $750,  $2500. 

The  following  depositors'  checks  have  come  in  from  the  clearing  house. 

D.  E.  Avery,  $1205 ;  J.  O.  Baker,  $916 ;  Thomas  Bennett  &  Co., 
$500;  E.  y.  Buckley  &  Son,  $702.50  ;  J.  H.  Crandall,  $19,500  ;  Decker 
Bros.,  $620.50  ;  C.  E.  Denison,  $40.90  ;  Fields  Milling  Co.,  $700  ;  Free- 
man, Austin  &  Co.,  $1200;  E.  L.  Howard,  $240;  Janis,  Cooper  & 
Tremper,  $700,  $800 ;  Lane,  Rowell  &  Co.,  $1200,  $1500 ;  Mace,  Gil- 
more  &  Co.,  $5260;  W.  I.  Pratt,  $60;  Powers  &  Sprague,  $75.90; 
C.  E.  Selover  &  Co.,  $370.50;  Spencer,  Mead  &  Co.,  $2160;  Wyckoff, 


66  BOOKKEEPING 

Seamans  &  Benedict,  f  17,300;  F.  E.  Sherman,  11764;  Certificate  of 
Deposit,  $2500  ;  Certified  Checks,  $17,500. 

Certified  checks  are  credited  when  issued  and  debited  when  paid. 
Debit  Certified  Checks  for  the  $17,500  above  and  show  the  payment  in 
the  certified  check  book. 

The  correspondence  clerk  has  turned  over  the  following  depositors' 
checks  received  from  out-of-town  banks. 

D.  B.  Roberts,  $1272.50  ;  Charles  J.  Kennedy,  $1100.40;  Fernald, 
Son  &  Co.,  $1500.90 ;  Spencer,  Mead  &  Co.,  $1100.50  ;  Wyckoff,  Sea- 
mans  &  Benedict,  $7250. 

Extend  the  balances  of  the  customers'  accounts  in  the  individual 
ledger.     Foot  and  prove  the  individual  ledger. 

Present  your  individual  ledger  to  your  instructor  for  approval. 

Transactions  for  the  General  Bookkeeper,  March  2 

Make  the  records  in  the  general  cash  book  as  outlined  March  1. 

1.  Enter  the  items  from  the  discount  register. 

2.  Enter  the  items  from  the  discount  tickler. 

3.  Enter  the  items  from  the  remittance  register. 

4.  Enter  the  items  from  the  individual  ledger. 

5.  From  the  collection  tickler  credit  Collection  and  Exchange  for  our 
collection  charges  on  collections  Nos.  723,  726,  742,  and  743. 

6.  From  the  receiving  teller's  daily  check  sheet  credit  Collection  and 
Exchange  for  the  collection  items  listed  there. 

7.  From  the  paying  teller's  daily  check  sheet  debit  Expense  for  the 
total  expense  items,  and  credit  Collection  and  Exchange  for  the  totals 
of  the  Sundry  Collection  and  Exchange  and  Exchange  columns. 

Prove  the  cash.  The  amount  of  bills  and  coin  on  hand  is  $215,819.76. 
Clearing-house  checks  on  hand  amount  to  $49,710.  Cash  items  (city 
and  foreign)  on  hand  amount  to  $7848.10. 

Rule  and  foot  the  general  cash  book.  Post  the  general  cash  book  to 
the  general  balance  ledger.  Extend  the  new  balances  on  the  general 
balance  ledger.     Prove  the  general  balance  ledger. 

Present  all  your  books  to  your  instructor  for  approval. 

Transactions  for  the  Discount  Clerk,  March  3 

The  following  paper  has  been  offered  and  accepted  for  discount. 
No.  932.    Note  of  Mason  &  Hamlin,  at  30  days  from  Feb.  24,  payable 
at  our  bank,  discounted  for  J.  O.  Baker,  for  $2500.     Proceeds  credited. 


BANKING  67 

No.  933.  Note  of  Zaner  &  Bloser,  at  60  days  from  Jan.  25,  payable 
at  our  bank,  discounted  for  Fields  Milling  Co.,  for  $4250.  Proceeds 
credited. 

No.  934.  Note  of  Gilbert  Bros.,  at  30  days  from  March  1,  payable  at 
Commercial  Bank,  Rochester,  N.Y.,  indorsed  by  Cushman  Bros.,  dis- 
counted for  Freeman,  Austin  &  Co.,  for  $5250.  Collection  and  exchange, 
$5.25.     Proceeds  credited. 

No.  935.  -Note  of  D.  Appleton  &  Co.,  at  one  month  from  Feb.  25, 
payable  at  First  National  Bank,  Springfield,  indorsed  by  M.  E.  Graham, 
discounted  for  E.  L.  Howard,  for  $7352.  Collection  and  exchange, 
$7.35.     Proceeds  credited. 

No.  936.  Note  of  M.  O.  White,  at  two  months  from  Feb.  1,  payable 
at  Traders  National  Bank,  Buffalo,  discounted  for  D.  E.  Avery,  for 
$9000.     Collection  and  exchange,  $9.     Proceeds  credited. 

No.  937.  Note  of  D.  B.  Roberts,  at  three  months  from  Jan.  1,  dis- 
counted for  C.  E.  Selover  &  Co.,  payable  at  our  bank,  for  $7000. 
Collection  and  exchange,  $7.     Proceeds  credited. 

No.  938.  Note  of  C.  A.  Wesp,  at  three  months  from  Jan.  1,  discounted 
for  C.  E.  Denison,  payable  at  Commercial  Bank,  Rochester,  N.Y.,  for 
$8750.     Collection  and  exchange,  $8.75.     Proceeds  credited. 

Rule  and  foot  the  discount  register.  Prove  the  footings.  Post  the 
entries  to  the  discount  tickler. 

Traksactions  for  the  Collection  Clerk,  March  3 

The  following  is  a  list  of  the  paper  received  for  collection  to-day. 

No.  819.  Sight  draft  dated  March  1,  on  Walker  Bros.,  City,  for 
$12,265.     To  be  collected  for  Traders  National  Bank,  Buffalo. 

No.  820.  Sight  draft  dated  March  1,  on  Morgan  &  Allen,  City,  for 
$5723.60.  To  be  collected  for  Manufacturers  and  Traders  Bank, 
Philadelphia. 

No.  821.  Sight  draft  dated  March  1,  on  Gilman  &  Brown,  City,  for 
$7321.     To  be  collected  for  Ninth  National  Bank,  Hartford. 

No.  822.  Sight  draft  dated  March  2,  on  Healey  &  Kinsley,  City, 
for  $3721.50.     To  be  collected  for  Chase  National  Bank,  Providence. 

No.  823.  Sight  draft  dated  March  2,  on  F.  E.  Smith,  City,  for 
$2129.74.     To  be  collected  for  Farmers  Bank,  Albany. 

No.  824.  Note  signed  by  Curtis  &  Bender,  dated  Feb.  8,  at  30  days, 
payable  at  Merchants  National  Bank,  City,  for  $5625.  To  be  collected 
for  Alliance  National  Bank,  Springfield, 


68  BOOKKEEPING 

No.  825.  Note  signed  by  Arnold  &  Co.,  payable  two  months  from 
Jan.  4,  at  Park  Square  National  Bank,  City,  for  $1365.  To  be  collected 
for  Spencer,  Mead  &  Co. 

No.  826.  Note  signed  by  Ray  &  Co.,  payable  at  60  days  from  Jan.  4, 
at  Union  Trust  Co.,  City,  for  $3000.     To  be  collected  for  J.  O.  Baker. 

No.  827.  A  draft  dated  Jan.  8,  at  60  days  from  date,  on  Joiner  &  Co., 
payable  at  Briggs  Bank,  Westfield,  for  $175.40.  To  be  collected  for 
Thomas  Bennett  &  Co. 

No.  828.  Draft  dated  Feb.  1,  at  30  days  from  date,  on  Houghton  & 
Button,  City,  for  $426.50.     To  be  collected  for  J.  H.  Crandall. 

No.  829.  Sight  draft  dated  March  3,  on  E.  L.  Grant,  City,  in  favor 
of  Freeman,  Austin  &  Co.,  for  $725.  To  be  collected  for  Freeman, 
Austin  &  Co. 

No.  830.  Note  of  Gardner  &  Son,  at  30  days  from  Feb.  16,  payable 
at  Park  Square  National  Bank,  City,  with  interest,  for  $2000.  To  be 
collected  for  Wyckoff,  Seamans  &  Benedict. 

No.  831.  Note  of  Frank  Miller,  at  three  months  from  Jan.  1,  for 
$1724.50,  payable  at  Union  Trust  Co.,  City.  To  be  collected  for  Farmers 
Bank,  Albany. 

No.  832.  Note  of  I.  A.  Wilcox,  at  two  months  from  Feb.  2,  payable 
at  Merchants  Bank,  St.  Louis,  Mo.,  with  interest,  for  $3000.  To  be 
collected  for  Chase  National  Bank,  Providence. 

Post  the  collection  register  to  the  collection  tickler. 

Transactions  for  the  Receiving  Teller,  March  3 

The  following  are  the  regular  deposits  for  to-day. 
Wyckofe,  Seamans  &  Benedict,  V  $4900,  B  $1700,  B  $1200,  B  $1400, 
X  $1100,  #61  $750,  #4  $300  ;  less  collection,  $1.10. 
Certificate  of  Deposit,  V  $200,  V  $400. 
Spencer,  Mead  &  Co.,  #7  $500,  #9  $1720.40,  #21  $850.60. 
F.  E.  Sherman,  V  $500,  B  $1900,  B  $5273.50. 

C.  E.  Selover  &  Co.,  #27  $60,  ^  $^300,  B  $1950,  #3  $1430.40. 
J.  O.  Baker,  V  $1100,  B$1340,  #11  $1500,  #7  $1324. 
Thomas  Bennett  &  Co.,  X  $1590.40 ;  less  collection,  $1.60. 
Decker  Bros.,  X  $2462.50 ;  less  collection,  $2.45. 

E.  V.  Buckley  &  Son,  V  $4900,  ^/  $60,  #12  $2163.40. 

D.  E.  Avery,  X  $1590.60 ;  less  collection,  $1.60. 

J.  H.  Crandall,  B  $11,290,  B  $14,360  ;  #7  $9353.60,  O  $240.50, 
O  $130.60. 


BANKING  69 

Freeman,  Austin  &  Co.,  O  ^7320,  #9  812,950,  #14  $7110.50. 

Charles  J.  Kennedy,  V  '^5800,  X  $1724.50  ;  less  collection,  $1.75. 

C.  E.  Denison,V  $4900,  V  $16.50,  #1  $1150.60,  #7  $1200,  #15 
$1900,  #31  $6200. 

Fernald,  Son  &  Co.,  V  $2400,  B  $500,  B  $6000. 

Fields  Milling  Co.,  X  $240,  x  $1200,  x  $1500 ;  collection,  $2.95, 
paid  in  cash. 

Janis,  Cooper  &  Tremper,  X  $1500,  X  $3000  ;  collection,  $4.50,  paid 
in  cash. 

Powers  &  Sprague,  V$1100,  V  $260,  X  $5000,  x  $50.32;  collection, 
$5,  paid  in  cash. 

Lane,  Rowell  &  Co.,  O  $1212.50. 

Foot  the  columns  of  the  receiving  teller's  daily  check  sheet.  Make 
out  Recapitulation  and  Proof  blank. 

Balance  on  hand;  coin,  $848.95;  bills,  $18,800.  You  have  given 
to  the  paying  teller  during  the  day  $7200. 

Transactions  for  the  Paying  Teller,  March  3 

The  following  are  lists  of  checks  paid  by  the  paying  teller  to-day. 

1.  Checks  on  our  bank: 

Certificate  of  Deposit,  $1000;  E.  L.  Howard  (New  York  draft), 
$562.50 ;  Mace,  Gilmore  &  Co.  (New  York  draft),  $1100 ;  W.  I.  Pratt 
(New  York  draft),  $4150;  Spencer,  Mead  &  Co.  (New  York  draft), 
$62.50;  Freeman,  Austin  &  Co.,  $6409.50;  E.  V.  Buckley  &  Son, 
$4150.90;  D.  B.  Roberts,  $9250;  F.  E.  Sherman,  $800;  Lane,  Howell 
&  Co.,  $2150 ;  E.  L.  Howard,  $8790.50. 

2.  Checks  on  clearing-house  banks : 

Old  Colony  National  Bank,  $1200 ;  Park  Square  National  Bank,  $1500; 
Bunker  Hill  National  Bank,  $2100  ;  SufPolk  National  Bank,  $1100.50; 
Colonial  National  Bank,  $3160;  Shoe  and  Leather  Bank,  $3750;  Third 
National  Bank,  $900 ;  Metropolitan  National  Bank,  $2160.50 ;  Citizens 
National  Bank,  $1325;  Eliot  National  Bank,  $5260;  New  England 
National  Bank,  $150 ;  Mechanics  Bank,  $52.60. 

3.  Checks  on  out-of-town  banks  : 

Traders  National  Bank,  Buffalo,  $400 ;  collection,  50/.  Bank  of 
Commerce,  Baltimore,  $160,  $200 ;  collection,  40/.  Manufacturers 
and  Traders  Bank,  Philadelphia,  $750,  $1200;  collection,  $2.  Fourth 
National  Bank,  Chicago,  $500,  $1500  ;  collection,  $2.  Merchants  Bank, 
New  York  City,  $1200,  $1100  ;  collection,  $2.25.    Farmers  Bank,  Albany, 


70  BOOKKEEPING 

$100 ;  collection,  15/.  Union  Bank,  Albany,  $400,  $200 ;  collection, 
75/.  Merchants  and  Traders  Bank,  Providence,  $1500 ;  collection, 
$1.50.     Peoples  Bank,  Worcester,  $1200;  collection,  $1.25. 

4.  Checks  on  banks  in  our  city  not  members  of  the  clearing-house 
association : 

Powers  Bank,  $400. 

Sold  the  following  drafts  on  Chemical  National  Bank,  New  York. 

1.  Sold  for  check : 

E.  L.  Howard,  $562  ;  exchange,  50/.  Mace,  Gilmore  &  Co.,  $1098.90  ; 
exchange,  $1.10.  W.  I.  Pratt,  $4145.85;  exchange,  $4.15.  Spencer, 
Mead  &  Co.,  $62.25 ;  exchange,  25/. 

2.  Sold  for  cash : 

Smith,  Perkins  &  Co.,  $1475 ;  exchange,  $2.  Hendricks  &  Son, 
$1100;  exchange,  $1.25.  Hopkins  &  Weeks,  $350;  exchange,  50/. 
E.  V.  Rhodes,  $100;  exchange,  25/. 

Certified  the  following  checks : 

Freeman,  Austin  &  Co.,  $1200 ;  C.  E.  Selover  &  Co.,  $3200 ;  Thomas 
Bennett  &  Co.,  $2700. 

Pay  cashier's  charge  tickets  for  the  following  items : 

Coal,  $42.50  ;  telephone  service,  $40.50  ;  cleaning  bank,  $9.50. 

The  items  for  the  Sundry  Receipts  column  are  as  follows : 

Bills  and  coin  from  yesterday's  proof,  $187,006.03 ;  bills  and  coin 
received  from  the  receiving  teller  at  the  close  of  yesterday's  business, 
$18,712;  bills  and  coin  received  from  the  receiving  teller  during  the 
day,  $7200 ;  bills  and  coin  received  from  the  note  teller  at  the  close  of 
yesterday's  business,  $10,101.73;  received  from  the  clearing  house  for 
to-day's  exchanges,  $14,503.50. 

Make  out  the  paying  teller's  proof.     Cash  on  hand,  $174,451.06. 

Foot  the  certified  check  book. 

Submit  your  paying  teller's  records  to  your  instructor  for  approval. 

Transactions  for  the  Note  Teller,  March  3 

Make  records  in  the  discount  tickler  for  the  paper  disposed  of  to-day. 
In  the  Remarks  column  write : 

For  No.  897,  Protested, 

For  No.  882,  Paid,  3/S. 

For  No.  883,  Certified,  C,  JST.  B. 

For  No.  875,  Certified,  S.  ^  L.  B, 
Rule  and  foot  the  discount  tickler. 


BANKIKG  71 

Advices  have  been  received  that  the  following  collections  have  been 
paid.  Make  the  proper  records  in  the  collection  tickler.  In  the 
Remarks  column  write: 

For  No.  752,  Charged  to  Alliance  National  Bank.     Bank's  collec- 
tion^ 75fi;  our  collection^  75 f. 
For  No.  757,  Charged  to  Traders  National  Bank.     Bank's  collec- 
tion^ $1.75;  our  collection.,  $2. 
Collections  Nos.  765,  819,  820,  829,  822,  823,  and  828  have  been 
paid.     In  the  Remarks  column  of  the  collection  tickler  write : 
For  No.  765,  Paid,  3/S. 
For  No.  819,  Paid,  3/3;  collection,  $12.25, 
For  No.  820,  Paid,  3/3;  collection,  $5.75. 
For  No.  829,  Paid,  3/3. 
For  No.  822,  Paid,  3/3;  collection,  $3.75. 
For  No.  823,  Paid,  3/3;  collection,  $2.15. 
For  No.  828,  Paid,  3/3. 
Collection  No.   821   has  been  protested.     In  the  Remarks  column 
write:  Protested,  3/3;  fees,  $3.25. 


Transactions  for  the  Correspondence  Clerk,  March  3 

This  morning's  mail  contained  the  following  remittances  from  the 
banks  named,  for  credit : 

Chemical  National  Bank,  New  York  $1350.25 

Alliance  National  Bank,  Springfield  3200.90 

Traders  National  Bank,  Buffalo  3160.50 

Bank  of  Commerce,  Baltimore  4200. 

Manufacturers  and  Traders  Bank,  Philadelphia  7371.80 

Chase  National  Bank,  Providence  5150.20 

Ninth  National  Bank,  Hartford  2625.80 

Fourth  National  Bank,  Chicago  1200.52 

The  following  are  drafts  on  Chemical  National  Bank,  New  York,  as 
per  stubs  in  the  draft  book. 

No.  441,  $562;  No.  442,  11098.90;  No.  443,  11475;  No.  444, 
14145.85;  No.  445,  fllOO;  No.  446,  |100;  No.  447,  1350;  No.  448, 
$62.25. 

Enter  the  above  drafts  in  the  draft  register.  Foot  the  draft  register 
and  credit  Chemical  National  Bank  in  the  remittance  register  for  the 
total.     Check  the  amount  transferred. 


72  BOOKKEEPING 

We  have  this  day  made  the  following  remittances  to  out-of-town 
banks  for  collection.  In  the  To  Whom  Sent  column  of  the  tickler 
write  the  name  of  the  bank  to  which  the  paper  is  sent.  No  other 
record  is  needed  at  this  time.  Discounts  Nos.  921  and  928  sent  to 
Alliance  National  Bank,  Springfield;  discount  No.  926  sent  to 
Fourth  National  Bank,  Chicago ;  discount  No.  929  sent  to  Ninth 
National  Bank,  Hartford ;  discount  No.  925  sent  to  Manufacturers 
and  Traders  Bank,  Philadelphia;  collection  No.  827  sent  to  Traders 
National  Bank,  Buffalo. 

We  have  this  day  made  the  following  remittances  to  out-of-town 
banks  for  credit. 

To  Farmers  National  Bank,  Albany. 

Check  of  Sears  &  Co.,  dated  Feb.  27,  on  Farmers  Bank,  indorsed  by 
J.  W.  Cook,  for  $100 ;  check  of  Ginn  &  Co.,  dated  Feb.  27,  on  Union 
Bank,  Albany,  indorsed  by  Day  Bros.,  for  $400;  check  of  Talton 
Bros.,  dated  Feb.  26,  on  Union  Bank,  Albany,  indorsed  by  Howard  & 
Brown,  for  $200 ;  check  of  Seymour  &  Co.,  dated  Feb.  25,  on  First 
National  Bank,  Albany,  indorsed  by  Wyckoff,  Seamans  &  Benedict, 
for  $1100. 

To  Chemical  National  Bank,  New  York. 

Check  of  C.  G.  Warner  &  Co.,  dated  Feb.  25,  on  Ninth  National 
Bank,  Brooklyn,  indorsed  by  Thomas  Bennett  &  Co.,  for  $1590.40  ; 
check  of  W.  C.  Lord,  dated  Feb.  26,  on  Second  National  Bank,  Brook- 
lyn, indorsed  by  Decker  Bros.,  for  $2462.50;  check  of  AV.  L.  Howard, 
dated  Feb.  24,  on  Merchants  Bank,  New  York  City,  mdorsed  by  Frey  «& 
Co.,  for  $1200 ;  check  of  A.  L.  Allen,  dated  Feb.  25,  on  JNlerchants 
Bank,  New  York  City,  indorsed  by  S.  C.  Williams,  for  $1100 ;  check 
of  M.  M.  Shea,  dated  Feb.  26,  on  City  National  Bank,  New  York, 
indorsed  by  D.  E.  Avery,  for  $1590.60. 

To  Manufacturers  and  Traders  Bank,  Philadelphia. 

Draft  of  Union  Bank,  Poughkeepsie,  dated  Feb.  25,  on  Bank  of  the 
Republic,  Philadelphia,  indorsed  by  Cliarles  J.  Kennedy,  for  $1724.50; 
draft  of  City  Bank,  Utica,  dated  Feb.  25,  on  First  National  Bank,  Phila- 
delphia, indorsed  by  Fernald,  Son  &  Co.,  for  $1500;  draft  of  Merchants 
Bank,  Rochester,  N.Y.,  dated  Feb.  25,  on  Manufacturers  and  Traders 
Bank,  indorsed  by  Smith  &  Co.,  for  $1200 ;  draft  of  Commercial  Bank, 


BACKING  73 

Buffalo,  dated  Feb.  26,  on  Manufacturers  and  Traders  Bank,  indorsed 
by  John  Stuart,  for  $750. 

To  Traders  National  Bank,  Buffalo,  N.Y. 

Check  of  J.  W.  Cody,  dated  Feb.  27,  on  Traders  National  Bank, 
indorsed  by  Charles  Good,  for  $400  ;  check  of  W.  D.  Adams,  dated  Feb. 
27,  on  Central  National  Bank,  Rochester,  N.Y.,  indorsed  by  Fields 
Milling  Co.,  for  |1200;  check  of  W.  D.  McKay,  dated  Feb.  25,  on 
Merchants  Bank,  Rochester,  N.Y.,  indorsed  by  Fields  Milling  Co., 
for  1240. 

To  Bank  of  Commerce,  Baltimore. 

Check  of  C.  W.  Smith,  dated  Feb.  24,  on  Bank  of  Commerce,  indorsed 
by  C.  W.  White,  for  $160;  check  of  Perdy  &  Co.,  dated  Feb.  23,  on 
Bank  of  Commerce,  indorsed  by  Allen  &  Co.,  for  $200 ;  check  of  Carter 
&  Co.,  dated  Feb.  24,  on  Central  Bank,  Baltimore,  indorsed  by  Janis, 
Cooper  &  Tremper,  for  $3000;  check  of  Clay  &  Co.,  dated  Feb.  25, 
on  Bank  of  Commerce,  indorsed  by  Janis,  Cooper  &  Tremper,  for  $1500. 

To  Fourth  National  Bank,  Chicago. 

Draft  of  Briggs  Bank,  Westfield,  dated  Feb.  28,  on  Commercial  Bank, 
Chicago,  indorsed  by  Powers  &  Sprague,  for  $50.32  ;  draft  of  Merchants 
Bank,  Providence,  dated  Feb.  24,  on  Central  National  Bank,  Chicago, 
indorsed  by  Powers  &  Sprague,  for  $5000 ;  check  of  Simpson  &  Frey, 
dated  Feb.  24,  on  Fourth  National  Bank,  indorsed  by  Frost  &  Co.,  for 
$500 ;  check  of  W.  A.  Harris,  dated  Feb.  24,  on  Fourth  National  Bank, 
indorsed  by  W.  W.  West,  for  $1500. 

To  Chase  National  Bank,  Providence. 

Check  of  Graham  &  Co.,  dated  Feb.  25,  on  Merchants  and  Traders 
Bank,  Providence,  indorsed  by  C.  W.  Hunter,  for  $1500;  check  of 
White,  Hayes  &  Co.,  dated  Feb.  24,  on  Chase  National  Bank,  indorsed 
by  Chemical  National  Bank,  New  York,  for  $1350.25. 

To  Alliance  National  Bank,  Springfield. 

Check  of  Hyde  &  Page,  dated  Feb.  27,  on  Peoples  Bank,  Worcester, 
indorsed  by  Fourth  National  Bank,  Chicago,  for  $1200.52. 

The  note  teller  has  advised  you  of  the  following  charges  to  banks. 
Alliance  National  Bank,  Springfield,  proceeds  of  collection  No.  752, 
$721.75 ;  Traders  National  Bank,  Buffalo,  proceeds  of  collection  No.  757, 

$1748.  25. 


74 


BOOKKEEPING 


Letter  of  Advice  and  Remittance.  —  When  banks  remit  by  New  York 
draft  for  collections  a  form  similar  to  the  following  is  used. 


F.  E.  ROGERS,  President                                                                                                                 S.  C.  WILUAMS,  Vice  President       ' 

CHAS.  H.  PALMER.  Cashier 

K/Zie    (chemical  >^atlonal  ^Jjank 

J^eiv  yonk,       ^eA.  2S,       79— 

fi'-.   UK   €U^,   Ssq.,  CasAlef 

^A>t(yyiial  cAatuyyuA.1  SoLnk 

JS(>^t(yyi,  7lla^^'. 

£bean  Sir, Please  find  heneiuitk  oun  draft  ^o,   //^-T 

on   S'k&  cAaluyyial  BamJo  o-f  R&cLeAn/JdA/yyv  for  ^///^.^^  in  pay= 

ment  of  collections  as  stated  6eloiv, 

YOUR  NO. 

DATE  OF 
YOUR  LEHER 

PAYER 

AMOUNT 

6/^ 

<^^^. 

/ 

R.  UK  ffcdt 

/060 

720 

/O 

fS.  €.  li^tiia^n.2^ 

^72 

60 

72^ 

/o 

(l.  E  S've.if  V  d'o^ 

700 

7^2 

/f 

€.  UK  ^n^oM^  V'  ^. 
Uotal  collected 

6000 

7722 

60 

Uess  Collection  and  Exchange 
>Ji mount  remitted 

7 

72 

77f^r 

7S 

Very  respectfulli/  yours 

^kaof.  fi^.   ^aZ'yyv&v,   Qashier 

The  note  teller  has  also  advised  you  that  the  following  collections 
have  been  paid  and  the  proceeds  credited  to  the  banks  named. 

Proceeds  of  No.  752,  credited  to  Traders  National  Bank,  Buffalo, 
$721 ;  proceeds  of  No.  757,  credited  to  Alliance  National  Bank,  Spring- 
field, $1746.25  ;  proceeds  of  No.  819,  credited  to  Traders  National  Bank, 
Buffalo,  $12,252.75  ;  proceeds  of  No.  820,  credited  to  Manufacturers  and 
Traders  Bank,  Philadelphia,  $5717.85  ;  proceeds  of  No.  822,  credited  to 
Chase  National  Bank,  Providence,  $3717.75;  proceeds  of  No.  823, 
credited  to  Farmers  Bank,  Albany,  $2127.59. 


BANKING  75 

The  note  teller  advises  that  collection  No.  821  has  been  protested 
and  the  protest  fees,  $3.25,  charged  to  Ninth  National  Bank,  Hartford. 
Extend  the  balances  in  the  remittance  register. 

Transactions  for  the  Individual  Bookkeeper,  March  3 

Enter  the  deposits  from  customers  in  the  individual  ledger  from  the 
receiving  teller's  daily  check  sheet. 

The  note  teller  has  turned  over  credit  tickets  for  the  proceeds  of 
collection  paper,  collected  for  depositors  to-day  as  follows :  Nos.  765, 
828,  and  829.  Enter  the  proceeds  of  these  collections  in  the  individual 
ledger. 

Credit  tickets  have  also  been  received  from  the  note  teller  for  paper 
discounted  for  customers  to-day.  Enter  these  notes  to  the  credit  of 
depositors  directly  from  the  discount  register. 

The  total  of  checks  certified  to-day,  as  reported  by  the  paying  teller, 
is  $7100.     Enter  this  amount  to  the  credit  of  Certified  Checks. 

Checks  of  depositors  have  been  received  by  the  paying  teller  and 
turned  over  to  the  individual  bookkeeper,  as  shown  on  the  paying 
teller's  daily  check  sheet.     Enter  these  items  in  the  individual  ledger. 

Charge  tickets  have  been  received  from  the  paying  teller  on  account 
of  certified  checks.  Refer  to  the  certified  check  book  for  these  amounts, 
and  enter  them  in  the  individual  ledger. 

Checks  of  depositors  have  been  received  by  the  receiving  teller, 
entered  on  liis  sheet,  and  turned  over  to  the  individual  bookkeeper.  A 
list  of  these,  with  the  names  of  the  drawers,  is  given  below.  Enter  the 
items  in  the  individual  ledger. 

Spencer,  Mead  &  Co.,  $1900 ;  Wyckoff,  Seamans  &  Benedict, 
$5273.50,  $1950,  $14,360;  E.  V.  Buckley  &  Son,  $1400,  $1200;  C.  E. 
Selover  &  Co.,  $1700 ;  Fernald,  Son  &  Co.,  $1340 ;  Powers  &  Sprague, 
$500;  Decker  Bros.,  $11,290;  F.  E.  Sherman,  $6000. 

Checks  of  depositors  have  come  in  from  the  clearing  house  as  follows  : 

Wyckoff,  Seamans  &  Benedict,  $17,700;  Spencer,  Mead  &  Co., 
$15,000,  $1800;  F.  E.  Sherman,  $960.50;  C.  E.  Selover  &  Co.,  $300; 
D.  B.  Roberts,  $750;  Powers  &  Sprague,  $1200;  Janis,  Cooper  &; 
Tremper,  $2400;  Mace,  Gilmore  &  Co.,  $1500;  Lane,  Rowell  &  Co., 
$1250 ;  D.  E.  Avery,  $900 ;  J.  O.  Baker,  $1700 ;  Thomas  Bennett  & 
Co.,  $3100  ;  E.  V.  Buckley  &  Son,  $9150.60  ;  J.  H.  Crandall,  $45,120 ; 
Decker  Bros.,  $15,200;  C.  E.  Denison,  $25,300;  Fernald,  Son  &  Co., 
$1300  ;  Fields  Milling  Co.,  $10,500. 


76  BOOKKEEPING 

The  correspondence  clerk  has  turned  over  depositors'  checks  received 
from  out-of-town  banks. 

Wyckoff,  Seamans  &  Benedict,  1625.80,  $2000 ;  Charles  J.  Kennedy, 
$150.20,  $2500  ;  W.  I.  Pratt,  $2500. 

Extend  the  balances  of  customers'  accounts  in  the  individual  ledger. 
Foot  and  prove  the  individual  ledger. 

Transactions  for  the  General  Bookkeeper,  March  3 

Make  the  records  in  the  general  cash  book  for  the  following. 

1.  Items  from  the  discount  register. 

2.  Items  from  the  discount  tickler. 

3.  Items  from  the  remittance  register. 

4.  Items  from  the  individual  ledger. 

5.  From  the  collection  tickler  credit  Collection  and  Exchange  for  our 
collection  charges  on  tho  following  collections:  Nos.  752,  757,  819,  820, 
822,  and  823. 

6.  From  the  receiving  teller's  daily  check  sheet  credit  Collection 
and  Exchange  for  the  collection  and  exchange  items  listed  there. 

7.  From  the  paying  teller's  daily  check  sheet  debit  Expense  for  the 
total  expense  items,  and  credit  Collection  and  Exchange  for  the  totals 
of  the  Exchange  and  Sundry  Collection  and  Exchange  columns. 

8.  From  the  collection  tickler  credit  Protest  Fees  for  $3.25,  the 
notary's  charges  for  protesting  collection  No.  821. 

9.  From  the  discount  tickler  debit  Protested  Paper  for  discount 
No.  897,  $29,900. 

Note.  —  Nearly  all  national  banks  have  some  bank  official  qualified  as  a  notary 
public.  In  the  majority  of  cases  this  official  receives  all  protest  fees  which  are 
paid  to  the  bank  for  protesting  paper.  He  is  usually  a  person  of  high  standing 
in  the  bank,  such  as  cashier,  discount  clerk,  etc.  When  these  fees  go  to  an  official 
of  the  bank  they  are  charged  to  Protest  Fees  in  the  general  balance  ledger.  At  the 
end  of  any  given  period  the  notary  may  draw  such  fees  by  check.  No  protest  fees 
are  entered  on  discount  No.  897  at  this  time.  They  are  not  recorded  until  collected, 
unless  they  are  charged  to  an  out-of-town  bank. 

Prove  the  cash.  Tho  amount  of  bills  and  coins  on  hand  is  $222,624.52  ; 
clearing-house  checks,  $33,997.04 ;  cash  items,  $15,229.20. 

Rule  and  foot  the  general  cash  book.  Post  the  general  cash  book  to 
the  general  balance  ledger.  Extend  the  new  balance  in  the  general 
balance  ledger.    Prove  the  general  balance  ledger. 

Submit  your  book  to  your  instructor  for  approval. 


BANKING 


77 


Closing  the  Banking  Set 

Inventories,  March  3,  19 — 
Real  Estate  : 

Banking  house  and  lot  $27000 

Furniture  and  Fixtures : 

Estimated  value  $12500 

United  States  Bonds : 

At  cost  $200000 

Stocks  and  Bonds : 

Present  value  '  $63750 

Interest  and  Discount  : 

Accrued  on  United  States  bonds  $650 

Trial  Balance. — No  trial  balance  is  necessary  in  this  set,  as  the 
general  balance  ledger  is  in  itself  a  trial  balance  of  the  general  ledger 
accounts  of  the  bank. 

Dividends.  —  It  is  customary  for  national  banks  to  declare  dividends 
semiannually  and  close  their  books.  Before  any  dividend  can  be 
declared  every  national  bank  must  carry  at  least  one-tenth  part  of  its 
net  profits  for  the  half-year  immediately  preceding  to  its  surplus  fund, 
until  the  same  shall  amount  to  20%  of  its  capital  stock.  After  the 
surplus  fund  has  been  deducted  the  directors  may  declare  a  dividend  of 
so  much  of  the  profits  remaining  as  they  deem  expedient. 

Statement  of  Resources  and  Liabilities.  —  A  statement  of  resources 
and  liabilities  is  usually  made  out  daily  in  all  large  national  banks. 
Such  a  statement  gives  the  condition  of  all  the  general  ledger  accounts 
of  the  bank,  together  with  a  detailed  exhibit  of  the  cash  account.  All 
items  of  information  entered  on  this  statement  are  properly  classified, 
thus  furnishing  data  for  the  computation  of  the  bank's  reserve,  and  for 
the  necessary  reports  to  the  Comptroller  of  Currency.  The  National 
Bank  Act  also  requires  that  every  national  bank  shall  make  to  the 
Comptroller  of  the  Currency  not  less  than  five  reports  during  each 
year.  These  reports  must  be  made  in  accordance  with  a  prescribed 
form  and  be  published  in  a  newspaper  where  the  bank  is  established. 
They  exhibit  in  detail  the  resources  and  liabilities  of  the  bank,  the 
amount  of  each  dividend,  and  the  net  earnings  in  excess  thereof. 

In  this  set  you  will  make  but  one  general  statement  of  resources  and 
liabilities.  Carefully  study  the  form  given  on  pages  78  and  79,  and 
then  proceed  to  make  your  statement  of  resources  and  liabilities. 


78 


BOOKKEEPING 


Statement  of 

(Commercial  >^citional  cBank, 


Cash 


Resources 

Bills  and  Coin 

Exchanges  for  Clearing  House 

Cash  Items  (City  and  Foreign) 


Bills  Receivable 

Bills  Discounted 
Protested  Paper 

Stocks  and  Bonds 

U.S.  Bonds  with  U.S.  Treasurer  (per  inventory) 

Premium  on  U.S.  Bonds 

Other  Stocks  and  Bonds  (per  inventory) 

Properties 

Real  Estate  (per  inventory) 
Fixtures  (per  inventory) 

Out^of-Town  Banks,  Dr. 

Due  from  Reserve  Agents 

United  States  Treasurer 
5%  Redemption  Fund 
Due  from  U.S.  Treasurer 

Overdrafts 


243700 

55166 

6240 


405750 
7200 


150000 

6000 

103500 


17500 
5200 


7500 
1000 


40 


305107 

412950 
259500 

22700 

22940 

100000 

8500 

620 


1132318  72 


32 


ft 


40 


60 


40 


Statement  of 


So/n/nefcia/  ^^ational  ^ank. 


Losses 
Current  Expenses 

Salaries,  due  and  paid 
Taxes,  due  and  paid 
Incidental  Expenses,  total  paid 

Depreciation 

Furniture  and  Fixtures 
Real  Estate 

Dividends,  4%  of  Capital  Stock 
Surplus  Fund,  10%  of  Net  Gain 
Undivided  Profits,  balance  of  Net  Gain 


4500 
960 
240 


150 
500 


93 


5700 


650 


IGOOO 
2415 
5735 


30501    09 


93 


14 


BANKING 


79 


Resources  and  Liabilities 
SBoston,    .^ass.,    Marcli  3,  19 — 


LiaUlities 

• 

Capital  Stock 

400000 

Surplus  Fund 

93630 

16 

Undivided  Profits 

9250 

60 

Circulation 

160000 

Out-of-Town  Banks,  Cr. 

12650 

90 

Deposits 

Cashier's  Checks 
Certificates  of  Deposit 
Certified  Checks 
Individual  Deposits 

Protest  Fees 

4050 

17500 

19295 

401750 

90 

60 
40 

442696 
140 

90 

Undinided  Prqfits  {Net  Gain) 

24150 

16 

^^^^^^^ 

1132318 

72 

Losses  and  Gains 

-" 

SBoston,   ^m/TLass.,   Marcli  3,  19 


Gains 
Revenue  Receipts 

Interest  and  Discount,  net  amount  earned 
Collection  and  Exchange,  net  amount  earned 
Interest  (per  inventory),  due  on  U.S.  Bonds 

Stocks  and  Bonds,  increase  in  value 


16500 

12500 

600 


29501 


1000 


09 


30601    09 


80 


BOOKKEEPING 


Hand  your  statement  of  resources  and  liabilities  to  your  instructor 
for  approval. 

Statement  of  Losses  and  Gains.  —  Preparatory  to  declaring  dividends 
and  closing  the  ledger  make  a  statement  of  losses  and  gains.  Before 
proceeding  with  this  statement  carefully  study  the  form  given  on  pages 
78  and  79.  The  net  gain  will  be  divided  as  follows:  To  Dividend 
account,  4<^  of  the  capital  stock;  to  Surplus  Fund,  10%  of  the  net 
gain ;  to  Undivided  Profits,  the  balance  of  the  net  gain. 

Hand  your  statement  of  losses  and  gains  to  your  instructor  for  approval. 

Closing  the  Ledger.  —  When  a  bank  employs  the  form  of  ledger  used 
in  this  set,  the  loss  and  gain  accounts  should  be  closed  by  journal  entries. 

To  take  the  gains  out  of  the  several  gain  accounts  and  carry  them  to 
the  Loss  and  Gain  account,  an  entry  similar  to  the  following  should  be 
made  in  the  journal. 


Interest  and  Discount 
Collection  and  Exchange 
Stocks  and  Bonds 
Interest 
To  Loss  and  Gain 


Net  amount  earned 
Net  amount  earned 
Increase  in  value 
Due  on  U.S.  bonds 
Total  gains 


1C500 

12500 

1000 

500 


40 


30501 


09 


To  take  the  losses  out  of  the  several  loss  accounts  and  carry  them  to 
the  Loss  and  Gain  account,  an  entry  similar  to  the  following  should  be 
made  in  the  journal. 


Loss  and  Gain 
To  Expense 
Salaries 
Taxes 
Real  Estate 
Furniture  and  Fixtures 


Total  losses 
Incidental  expenses 
Due  and  paid 
Due  and  paid 
Depreciation 
Depreciation 


C350 

93 

240 
4500 
960 
600 
150 

93 


To  close  the  Loss  and  Gain  account,  an  entry  similar  to  the  following 
should  be  made  in  the  journal. 


Loss  and  Gain 
To  Dividends 
Surplus  Fund 
Undivided  Profits 


Net  gain 

4%  of  capital  stock 
10%  of  net  gain 
Balance  of  net  gain 


24150 


16 


16000 
2415 
5735 


After  making  the  necessary  entries  to  close  the  loss  and  gain  accounts 
post  them  to  the  general  balance  ledger. 

Dividends  are  usually  paid  by  cashier's  checks.  Dividend  account  is 
debited  and  Cashier's  Checks  account  is  credited  when  dividends  are 


BANKING 


81 


paid.  You  will  omit  the  dividend  checks,  as  no  list  of  stockholders  has 
been  given. 

Extend  the  new  balances  in  the  general  balance  ledger. 

Prove  the  general  balance  ledger. 

Prove  the  correctness  of  the  out-of-town  banks  ledger  by  an  abstract 
similar  to  the  following.  ^- 


Abstract  of  Out-of-Town  Banks  Ledger,  March  3,  19 


Union  Bank,  Troy 

Traders  National  Bank,  Buffalo 

Chemical  National  Bank,  New  York 

Merchants  Bank,  Philadelphia 

Mechanics  National  Bank,  Baltimore 

City  Bank,  Providence 

Balance  as  per  Out-of-  Town  Banks  in  G.  B.  L. 


7200 

31250 

2692 

1790 


429.34 


906 


1200 


42934 


See  if  Deposits  account  in  the  general  balance  ledger  agrees  with  the 
individual  ledger. 

Prove  the  discount  tickler.  The  total  of  the  unpaid  notes  shown  in 
the  discount  tickler  should  equal  the  balance  of  Bills  Discounted  account 
in  the  general  balance  ledger. 

Present  all  your  books  to  your  instructor  for  examination. 


82  BOOKKEEPING 


THE   CLEARING   HOUSE 


A  Clearing  House  is  an  institution  organized  by  associated  banks  to 
simplify  and  facilitate  daily  exchanges  of  items  and  settlements  of 
balances  resulting  from  such  exchanges. 

Many  clearing-house  associations  also  look  after  the  mutual  welfare 
of  their  members  by  prescribing  rules  to  govern  in  various  important 
matters ;  as,  uniform  rates  of  collection  and  exchange,  interest,  etc. 

Origin.  —  Before  clearing  houses  were  organized  each  bank  in  a  given 
city  had  to  keep  an  account  with  practically  every  other  commercial 
bank  in  that  city.  Statements  of  these  accounts  were  made  up  daily 
and  given  to  "runners,"  who  took  them,  together  with  the  items  of 
charge,  to  the  debtor  banks  for  settlement.  All  amounts  were  usually 
paid  in  gold.  In  the  larger  cities  this  work  was  very  laborious  and 
unsatisfactory.  To  facilitate  matters  these  runners  conceived  the  idea 
of  meeting  at  a  given  point  and  adjusting  balances.  From  these  first 
crude  gatherings  has  sprung  the  stupendous  clearing-house  system. 

The  Officers  of  a  clearing-house  association  are  usually  president,  vice 
president,  secretary,  treasurer,  manager,  and  clearing-house  committee. 
Frequently  there  are  one  or  more  special  committees ;  as,  conference 
committee,  nominating  committee,  arbitration  committee,  etc. 

Preparing  Exchanges  for  Delivery.  —  When  exchangeable  paper  is 
received  at  a  bank  it  is  classified  according  to  the  bank  at  which  it  is 
payable.  The  work  of  assorting  the  items  for  delivery  to  the  clearing 
house  is  facilitated  by  the  use  of  a  case  of  compartments.  This  case  is 
provided  with  a  compartment  for  each  member  of  the  clearing  house. 
The  compartments  are  designated  by  the  clearing-house  numbers  of  the 
banks.  Before  the  items  are  placed  in  these  compartments  they  are 
stamped  with  the  receipted  indorsement  usually  required  by  clearing-house 
associations.  The  form  of  this  indorsement  is  not  always  the  same,  but  it 
should  always  indicate  the  channel  through  which  the  paper  has  passed. 


Received  Payment 

through  the 

Boston  Clearing  House, 

Feb.  16,  19—. 

WiNTHROP  National  Bank. 


The  above  is  a  common  form  of  indorsement  used  for  items  paid 
through  the  clearing  house. 


BANKING 


83 


At  the  close  of  the  day,  or  at  intervals  during  the  day,  the  exchanges  are 
taken  from  the  compartments,  and  the  amounts  listed  on  a  blank  entitled 
Exchange  Slip^  as  shown  in  the  accompanying  illustration. 

The  first  total  on  the  ex- 
change slip  represents  the 
amount  of  exchanges  received 
by  No.  24  before  the  close  of 
banking  hours  on  Feb.  15,  to 
be  sent  to  the  clearing  house 
the  following  day.  The  addi- 
tional items  represent  the  morn- 
ing exchanges  which  are  received 
by  mail  or  among  the  deposits 
before  ten  o'clock.  The  second 
total  is,  then,  the  amount  of 
claims  carried  to  the  clearing 
house  by  No.  24,  Faneuil  Hall 
National  Bank,  against  No.  22, 
the  National  Bank  of  Commerce. 

A  separate  exchange  slip, 
appropriately  labeled,  is  pre- 
pared for  each  member  of  the 
clearing  house. 

Duplicate  lists  of  all  items 
taken  to  the  clearing  house  are 
made  by  the  bank  and  preserved 
for  future  reference. 

The  totals  of  the  exchange 
slips  are  next  copied  on  a  blank 
entitled  Settling  Clerk'' s  State- 
ment. 

The  Settling  Clerk's  Statement 
contains  a  printed  list  of  the 
names  and  numbers  of  all  the 
banks    connected   with   the 

clearing-house  association.  The  first  debit  column  of  this  sheet  is 
usually  made  up  from  the  exchange  slips  at  the  close  of  each  busi- 
ness day,  thus  completing  the  heaviest  part  of  the  work  the  day  before 
clearing.  On  the  morning  of  clearing  the  second  debit  column  is  filled 
out  from  the  final  totals  of  the  exchange  slips.     The  credit  column  is 


1 

EXCHANGED      SIvIP 

NO.        22 

COIVLIVIERCE 

KRONl      NO.      24 

Date       S^&(^.   /6,   /^ 

62¥-0 

760 

^00 

fO 

7666 

60 

^60 

76 

36^2 

60 

^00 

6600 

/^2 

SS 

^ 

6/ 

/200 

^0 

660 

2886/ 

6^ 

760 

60 

(fO 

6^ 

2^26/- 

84 


BOOKKEEPING 


Settling  Clerk's  Statement 


No.   37-     NATIONAL   BANK  OF   REDEMPTION 

Tuesday,  May  20,  19 


NO. 

BANKS 

FIRST  DEBIT 

ADDITIONS 

TOTAL  DEBIT 

BANKS  CR. 

NO. 

1 

Massachusetts  National 

G5198 

11 

29827 

71 

1 

2 

National  Union 

29767 

29 

19569 

67 

2 

3 

Old  Boston  National 

1.3413 

12 

1904 

81 

3 

4 

State  National 

74646 

39 

46131 

40 

4 

5 

New  England  National 

87391 

81 

79384 

08 

6 

12 

Atlantic  National 

17604 

30 

19678 

91 

12 

13 

Merchants  National 

92694 

99 

122665 

24 

13 

15 

National  Hamilton 

40635 

19 

20446 

16 

15 

17 

Second  National 

92069 

05 

199000 

35 

17 

18 

Atlas  National 

71649 

76 

30921 

52 

18 

20 

National  Shawmut 

642618 

69 

385833 

63 

20 

21 

National  Exchange 

84249 

17 

77924 

75 

21 

22 

Nat'l  B'k  of  Commerce 

130984 

52 

^    ■ 

249681 

75 

22 

24 

Faneuil  Hall  National 

39426 

09 

5206 

56 

24 

Z5 

National  Webster 

1950 

83 

2251 

64 

25 

26 

Eliot  National 

214234 

90 

248014 

63 

26 

28 

Suffolk  National 

85573 

82 

39980 

14 

28 

31 

Freemans  National 

9192 

09 

19051 

61 

31 

32 

Boylston  National 

6854 

45 

13825 

75 

32 

37 

Nat'l  B'k  Redemption 

37 

39 

First  National 

12132 

91 

66300 

81 

39 

41 

Nat'l  B'k  of  Republic 

171745 

26 

123536 

76 

41 

C3 

Mt.  Veraon  National 

6345 

06 

2614 

90 

43 

^_6 

National  Security- 

8697 

70 

10800 

38 

46 

-iS 

Central  National 

89203 

36 

25580 

27 

49 

CO 

Colonial  National 

21438 

57 

12175 

44 

50 

51 

Fourth  National 

36105 

94 

102526 

31 

61 

52 

Metropolitan  National 

13667 

09 

• 

5600 

66 

52 

53 

Winthrop  National 

67338 

76 

10159 

08 

53 

55 

Mechanics  National 

8947 

19 

13280 

66 

55 

56 

Commercial  National 

14849 

40 

13940 

64 

56 

100 

Boston  Clearing  House 

165844 

36 

411388 

32 
14 
09 

100 

Footings 

2416470 

23 
09 
14 

Balance 

Gain 

= 

2409865 
6605 

0605 

2409865 

2416470 

23 

BANKING 


85 


left  blank  to  be  filled  out  at  the  clearing  house  when  each  settling  clerk 
has  received  from  the  various  members  all  the  items  to  be  paid  by  his  bank. 
When  the  exchange  slips  have  been  completed,  and  the  amounts  have 
been  transferred  to  the  settling  clerk's  statement,  each  slip  is  attached 
to  the  package  of  items  which  it  represents. 

Note.  —  The  Boston  banks  have  the  settUng  clerk's  statement  arranged  with 
four  columns,  but  these  banks  usually  make  use  of  but  two  columns,  as  shown  on 
page  84.  "W^ere  but  two  columns  are  used  only  the  final  totals  of  the  exchange 
slips  are  copied  on  the  settling  clerk's  statement. 

The   Check  Ticket.  — The 

amounts  of  the  exchange  slips 
are  also  entered  on  Check  Tick- 
ets. A  check  ticket  is  made 
out  for  each  member  of  the 
clearing-house  association  and 
delivered  to  the  proper  settling 
clerk  at  the  clearing  house  to 
enable  him  to  check  off  the 
amounts  he  receives  from  other 
banks,  in  case  there  is  an  error. 

The  Credit  Ticket.  —  Before  going  to  the  clearing  house  the  settling 
clerk  foots  and  proves  the  Total  Debit  column  of  the  settling  clerk's 
statement.  If  this  footing  is  correct  it  should  agree  with  the  totals  of 
the  clearing-house  checks  on  the  receiving,  paying,  and  note  tellers'  and 
correspondence  clerk's  daily  check  sheets.  When  this  footing  has  been 
proved  correct  the  settling  clerk  enters  it  on  a  Credit  Ticket. 


J{o,  26 

S/iot  National,    ^ank 

From  No.  51 

%Tourth    ymA/atlonal  t/janli 


Form  of  Credit  Ticket 


LU 


LU 


No.  21.     Boston  Clearing  House 


Credit 

National  Exchange  Bank 


S^eA.    /6,    I9_ 
f.  If.  BeyyidsA.,    Settling  Clerk 


How  Non-Members  clear.  —  Besides  the  regular  members,  there  are 
a  number  of  trust  companies  that  make  their  clearings  at  the  Boston 


86  BOOKKEEPING 

Clearing  House  through  the  agency  of  other  banks  which  are  members. 
These  non-members  keep  adequate  funds  on  deposit  at  their  clearing 
bank,  as  a  compensation  for  services  rendered  and  as  a  guarantee 
against  loss.  They  prepare  their  exchanges  in  practically  the  same 
manner  as  the  regular  members,  but  deliver  their  packages  of  items  to 
their  agents  for  deposit  instead  of  to  the  clearing  house  for  settlement. 
These  agents  classify  and  distribute  the  paper  of  the  non-members  just  as 
they  do  the  regular  items  received  on  deposit.  The  return  exchanges  for 
non-members  at  the  clearing  house  are  delivered  to  the  clearing  agents  just 
as  if  they  were  payable  by  them.  After  these  items  are  charged  to  the 
non-members  by  the  clearing  agents  they  are  promptly  transmitted  by 
runners  to  the  banks  where  they  are  to  be  paid. 

Procedure  in  making  Clearings.  —  Each  business  day  at  ten  o'clock 
the  exchanges  take  place  between  the  banks.  About  five  minutes 
before  the  hour  designated  the  clerks  begin  to  arrive.  These  clerks 
are  usually  two  in  number,  each  bank  sending  to  the  clearing  house  a 
delivery  clerk  and  a  settling  clerk.  On  his  arrival  at  the  clearing  house 
the  settling  clerk  leaves  at  the  desk  of  the  proof  clerk,  sitting  in  the 
manager's  office,  his  credit  ticket  showing  the  amount  of  exchanges  with 
which  his  bank  is  to  be  credited.  The  proof  clerk  immediately  tran- 
scribes this  amount  under  Banks  Cr,  on  a  blank  called  the  Clearing- 
House  Proofs  as  illustrated  on  page  87. 

The  aggregate  of  the  credit  tickets  presented  to  the  proof  clerk  rep- 
resents the  total  exchanges  sent  in  by  the  various  banks,  and  is  called 
Credit  Exchanges, 

The  desks  in  a  clearing  house  are  usually  arranged  in  long  rows,  one 
desk  being  provided  for  each  member.  At  one  minute  before  ten 
o'clock  the  manager  sounds  a  gong  as  a  signal  for  the  clerks  to  take 
their  proper  places.  The  settling  clerks  occupy  their  separate  desks  on 
the  inside  of  the  counter,  while  the  delivery  clerks  form  on  the  outside 
with  their  exchanges  arranged  for  convenient  distribution.  Promptly  at 
ten  o'clock  the  manager  again  sounds  the  gong,  and  the  delivery  of  the 
exchanges  begins.  Each  delivery  clerk  advances,  one  desk  at  a  time, 
with  military  precision.  At  each  desk  he  hands  over  to  the  settling 
clerk  the  exchange  package  for  that  particular  bank.  At  the  same 
time,  in  an  opening  in  the  desk  provided  for  that  purpose,  he  deposits 
a  check  ticket,  corresponding  in  amount  to  the  amounts  listed  on  the 
exchange  slips.  The  settling  clerk  takes  the  amount  on  the  exchange 
slips  and  enters  it  to  the  credit  of  the  proper  bank  on  his  own  state- 
ment.    After  the  circuit  has  been  completed  each  delivery  clerk  is  at 


BANKING 


87 


Boston  Clearing  House  Proof 

Tuesday,  May  20,  19 


NO. 

BANKS 

BALANCES 

DUE  TO  CLEARING 

HOUSE 

EXCHANGES 
BANKS  D:^.                  banks  CR. 

BALANCES 
DUE  TO  THE  BANKS 

NO. 

1 

Massachusetts  National 

137116 

01 

691195 

70 

554079 

09 

1 

2 

National  Union 

87417 

48 

391522 

85 

354105 

37 

2 

3 

Old  Boston  National 

8G101 

85 

243422 

29 

157320 

44 

3 

4 

State  National 

454779 

21 

567671 

69 

112892 

48 

4 

5 

New  England  National 

190038 

36 

240816 

86 

50778 

50 

5 

12 

Atlantic  National 

146654 

11 

227212 

02 

80557 

91 

12 

13 

Merchants  National 

132056 

29 

1351212 

39 

1219156 

10 

13 

15 

National  Hamilton 

C4170 

54 

395649 

79 

341479 

25 

15 

17 

Second  National 

613635 

51 

1104116 

94 

490481 

43 

17 

18 

Atlas  National 

1025G8 

01 

398617 

81 

296049 

80 

18 

20 

National  Shawmut 

335824 

88 

4109685 

56 

3773860 

68 

20 

21 

National  Exchange 

38771 

98 

938973 

65 

900201 

67 

£1 

22 

Nat'l  B'k  of  Commerce 

908658 

45 

1174063 

77 

265405 

32 

22 

24 

Faneuil  Hall  National 

23898 

97 

189501 

57 

165602 

60 

24 

25 

National  Webster 

54331 

39 

65216 

89 

10885 

50 

25 

26 

Eliot  National 

89495 

03 

1196253 

14 

1106758 

11 

26 

28 

Suffolk  National 

94489 

10 

690275 

61 

595786 

51 

28 

31 

Freemans  National 

111167 

50 

155111 

74 

43944 

24 

31 

32 

Boylston  National 

68422 

21 

81747 

05 

13324 

84 

S2 

37 

Nat'l  Bank  Redemption 

2409865 

14 

2416470 

23 

6605' 

09 

37 

39 

First  National 

122675 

28 

539383 

18 

416707 

90 

39 

41 

Nat'l  Bank  of  Republic 

1086691 

28 

1279888 

23 

193196 

95 

41 

43 

Mt.  Vernon  National 

11046 

74 

76455 

77 

65409 

03 

43 

46 

National  Security 

4121 

63 

74626 

44 

70504 

81 

46 

49 

Central  National 

68804 

57 

317969 

52 

249164 

95 

49 

50 

Colonial  National 

3338 

12 

262315 

20 

258977 

08 

50 

51 

Fourth  National 

371878 

03 

476835 

03 

104957 

51 

52 

Metropolitan  National 

2830 

85 

78607 

03 

75776 

18 

52 

53 

Winthrop  National 

210240 

230718 

68 

20478 

68 

53 

55 

Mechanics  National 

•  34286 

67 

108049 

77 

73763 

10 

55 

56 

Commercial  National 

14493 

34 

144410 

69 

129917 

35 

56 

100 

Boston  Clearing  House 

1816532 

10 

1816532 

10 

100 

Aggregates 

1393507 

94 

20641021 

25 

20641021 

25 

1393507 

94 

88  BOOKKEEPING 

the  point  from  which  he  started,  and  the  settling  clerk  has  on  his 
desk  exchange  packages  received  from  each  of  the  other  banks. 
Being  now  at  lil^erty,  each  delivery  clerk  gathers  up  tlic  packages 
against  his  bank,  usually  called  Debit  Exchanges,  and  returns  with 
them,  while  the  settling  clerks  remain  until  the  clearing-house  proof 
has  been  made. 

After  the  amounts  of  all  the  exchange  packages  have  been  properly 
entered,  the  settling  clerk  proceeds  to  foot  his  statement  and  ascertain 
the  amount  his  bank  is  to  receive  or  pay.  He  then  makes  out  a  balance 
ticket,  which  is  sent  to  the  proof  clerk's  desk.  This  ticket  shows  the 
total  exchanges  brought  to  and  received  at  the  clearing  house,  together 
with  the  balance  to  be  received  or  paid  by  his  bank. 

Form  of  Balance  Ticket 


UJ 


LU 

z 


^ 


No.  1.     Boston  Clearing  House 

Dr.    Massachusetts  National  Bank,      Am't  Rcc'd.  %2^6,/37.'' 
Cr.  '•  €1  «  Am't  Bro't.  $J^i',^c5'^.^' 

Balance  $ — ^^-^duc  Clearing  House,        % 

Balance  due  the  Massachusetts  National  Bank,  $   67,0^7°"^ 

f.  f-f.  Be/yLcUv,    Settling  Clerk 


When  the  proof  clerk  receives  the  balance  tickets  from  the  several 
settling  clerks  he  immediately  transcribes  the  debit  exchanges  (the 
amount  received  by  any  bank)  in  the  Banks  Dr.  column,  and  the  dif- 
ference between  the  debit  and  credit  exchanges  in  the  Due  Banks  or 
the  Due  Clearing  House  column,  as  the  case  may  be,  on  the  clearing- 
house proof.  The  credit  exchanges  having  been  previously  entered,  the 
proof  clerk  now  proceeds  to  complete  his  proof.  As  the  total  exchanges 
brought  must  be  the  same  as  the  total  exchanges  taken  away,  the  debit 
and  credit  columns  of  the  proof  should  agree  if  the  work  is  correct,  as 
also  the  total  due  banks  and  the  total  due  the  clearing  house. 

While  the  preparation  of  the  proof  is  in  progress  the  settling  clerks 
are  verifying  their  work  by  means  of  check  tickets.     If  there  are  no 


BANKING  89 

errors  in  the  clearing-house  proof  the  manager  announces  the  fact  and 
the  settling  clerks  return  to  their  banks.  If  there  is  an  error,  and  this 
is  not  infrequently  the  case,  the  proof  clerk  announces  the  difference  to 
the  manager.  The  manager  then  announces  the  difference  to  the  set- 
tling clerks,  who  proceed  to  search  for  it.  When  this  announcement  is 
made  the  settling  clerks  have  usually  completed  a  revision  of  their 
statements,  and  can  many  times  locate  discrepancies  as  soon  as  they  are 
announced -by  the  manager. 

Various  methods  are  resorted  to  in  locating  differences.  Usually  the 
manager  calls  for  an  exchange  of  sheets  to  the  right  or  to  the  left  for 
an  examination  of  footings,  and  in  cases  where  an  error  in  entry  is 
apparent  the  amounts  are  called  back.  This  revision  i3  final,  and  if  the 
additions  are  correct  it  must  make  the  proof  balance. 

The  accompanying  Clearing-House  Proof  and  Settling  Clerk's  State- 
ment are  actual  forms  used  in  transactions  at  the  Boston  Clearing  House. 

Debtor  and  Creditor  Banks.  —  Thus  far  no  money  has  entered  into  the 
exchanges  at  the  clearing  house.  The  clearing,  however,  is  not  yet 
complete.  If  the  total  of  the  items  brought  to  the  clearing  house  by 
any  particular  bank  is  less  than  the  total  of  the  items  brought  by  other 
banks  against  it,  the  bank  owes  the  clearing  house  the  difference  between 
such  totals.  On  the  other  hand,  if  the  items  brought  to  the  clearing 
house  by  any  bank  are  greater  than  the  totals  brought  against  it,  that 
bank  u  entitled  to  receive  from  the  clearing  house  the  difference  between 
such  totals.  To  complete  the  clearing,  therefore,  it  is  necessary  to  make 
settlement  for  the  debit  and  credit  balances. 


Form  of  Manager's  Receipt 

1 

No.  50.    Boston  Clearing  House 

in 

?9raA^ 

s,  19— 

1- 

Received   from  COLONIAL  NATIONAL  BANK 

LU 

S^W'emty-Q^eA)-em.   ^ko-vxuM^cL  c^C^&  /f^^m-dv&d   ofi/ycti^ 

^  Dollars 

lOO 

LU 

in  full  for  balance  due  the  Clearing  House. 

1 

Manager 

90  BOOKKEEPIKG 

At  12.15  P.M.  each  day  except  Saturday,  and  then  at  11.30  a.m.,  the 
debtor  banks  must  pay  to  the  manager  at  the  clearing  house  the  balances 
due  from  them  respectively,  either  in  coin  or  in  such  other  currency  as 
the  laws  of  the  United  States  shall  require,  or  in  such  certificates  as 
shall  be  authorized  by  the  clearing-house  association,  excepting  sums 
less  than  one  thousand  dollars,  which  may  be  paid  in  bills  of  the  debtor 
banks. 

Receipts  signed  by  the  manager  are  given  to  the  banks  making  the 
payments.     (See  page  89.) 

At  1.30  P.M.  each  day  except  Saturday,  and  then  at  12  M.,  the  creditor 
banks  shall  receive  from  the  manager  at  the  clearing  house  the  balances 
due  them  respectively. 

Receipts  signed  by  the  cashiers  of  the  creditor  banks  are  given  to  the 
manager  of  the  clearing  house. 

Form  of  Cashier's  Receipt 


National  Security  Bank 

% 2^,6^0. *>^  Boston.     InoA^k  26,  \^ 

Received  from  C  A.  RUGGLES.  Manager  of  the  Boston 
Clearing  House,  by  /^o-6-£aZ  10^.  ^va,rX  ,  Messenger  of  this  Bank, 
^w-€/nty-j(yuA^  ij^k<yiia^a/yicC  ^{/?o  f'fu/yuiv&ci  S^o\tAf  — -^.^^-^^-v^  Dollars, 
bein^  the  amount  gained  by  this  Bank  to-day  at  the  Clearing  House. 

Ziy.  CL.   /i-l/yiAyux-n,  Cashier 


Should  any  bank  not  make  payment  as  provided,  the  manager  causes 
a  new  settlement  to  be  made  and  new  balances  to  be  ascertained,  by 
eliminating  from  the  settling  sheet  of  each  and  every  bank  all  the 
amounts  charged  or  credited  thereon  to  the  defaulting  bank  and  also 
the  debit  and  credit  amounts  on  the  settling  sheet  of  the  defaulting 
bank.  The  new  balances  as  thus  ascertained  are  the  balances  to  be 
settled  by  the  several  banks.  In  case  some  of  the  banks  have  paid  the 
balances  first  ascertained  such  banks  are  called  upon  to  make  an  adjust- 
ment with  the  clearing-house  manager. 

Immediately  after  the  new  settlements  have  been  made  each  bank  is 
called  upon  to  deliver  to  the  manager  all  the  items  which  were  received 


BANKING  91 

from  the  defaulting  bank,  or  in  lieu  thereof  the  money,  which  items  or 
money  the  manager  tenders  to  the  defaulting  bank  and  demands  all  the 
items  received  by  the  defaulting  bank  at  the  clearing  house.  The  items 
received  from  the  defaulting  bank  by  the  manager  are  then  returned  to 
the  respective  banks  from  which  they  originally  came. 

Scale  of  Fines.  —  The  following  is  the  scale  of  fines  prescribed  by  the 
Boston  Clearing  House. 

1.  For  disorderly  conduct  of  any  clerk  at  the  clearing 

house,  or  disregard  of  the  manager's  rules  and 
instructions,  for  each  offence  -  $4 

2.  For  any  clerk  failing  to  attend  punctually  at  the 

hour  for  making  exchanges  4 

3.  Debtor  banks,  failing  to  pay  their  balances  before 

a  quarter  past  twelve  o'clock  3 

4.  Any  error  in  the  credit  ticket  (that  is,  the  amount 

brought)  2 

5.  Errors  in  making  the  balance  ticket  (that  is,  the 

amount  received)  ^  2 

6.  Failing  to  deliver  check  tickets  before  twenty  min- 

utes past  ten  o'clock  1 

7.  All  other  errors  2 

LETTERS   OF  CREDIT 

Definition.  —  A  letter  of  credit  is  an  instrument  issued  by  a  banker, 
and  addressed  to  his  correspondents  in  specified  places,  by  which  a 
named  person  may  draw  funds  in  amounts  to  suit  his  convenience,  upon 
his  complying  w^ith  certain  requirements,  such  as  identifying  himself, 
etc.,  the  total  amount  drawn  not  to  exceed  the  amount  limited  by  the 
letter  of  credit. 

To  whom  issued.  —  Letters  of  credit  are  usually  issued  for  the  use 
of  travelers  in  foreign  countries,  to  save  the  transmission  of  money  from 
one  part  of  the  world  to  another,  thus  avoiding  the  risk  necessarily 
incident  to  carrying  real  money  about. 

How  Funds  are  obtained.  —  When  a  letter  of  credit  is  issued  to  a 
traveler  he  is  required  to  subscribe  his  name  on  the  document  in  the 
banker's  presence,  as  a  means  of  identification  later  on.  Other  copies 
of  the  signature  are  sometimes  left  and  forwarded  to  the  leading  foreign 
bankers  drawn  upon.     When  the  traveler  desires  funds  he  will  present 

1  Thirty  minutes  is  allowed  for  the  morning  settlement,  and  for  each  additional  fifteen 
minutes'  detention  $2  is  added  to  this  sum. 


92  BOOKKEEPING 

his  letter  to  the  proper  banker  at  the  place  where  he  may  be  staying.  The 
letter  itself  always  specifies  the  banks  that  will  honor  the  draft.  When 
the  letter  is  presented  to  a  foreign  banker  for  payment,  he  draws  a  sight 
draft  on  the  London  banker  specified,  which  draft  the  traveler  is  required 
to  sign.  If  the  signatures  on  the  letter  and  the  draft  are  identical,  the 
amount  desired  is  promptly  paid  and  indorsed  on  the  back  of  the  letter. 
Payment  is  usually  made  upon  the  simple  identification  of  comparison 
of  signatures.  The  indorsements  on  the  back  of  the  letter  show  at  all 
times  the  balance  available  for  the  traveler.  The  bank  making  the  last 
payment  retains  the  letter  to  send  to  the  drawees  in  London. 

Bro-wn  Brothers  &  Co.'a  Circular  Letter  of  Credit 


No.   7^/6  JSoU<yyv,   ?71a^2..,   7}iaA^k   6,    19o6 

Gentlemen : 

We   beg  to  introduce  to  you  ?71v.    jo-k'yv  €..  cAcyuvl^,  to  whom 

you  ivill  'please  furnish  such  funds  as  he  may  require  up  to  the 
I  aggregate  amount  of  <5^iv-&  /'fwyuLvt^L  pounds  sterling  against  demand 
g  drafts  on  Messrs.  Brown,  Shipley  ^  Co.,  London,  each  draft  to  he 
-*  plainly  marked  as  drawn  under  Brown  Brothers  ^  Co.^s  Letter 
I    of  Credit  No.   r£/5. 

I  We  engage  that  such  drafts  shall  meet  with  due  honor  in  London, 

I  if  negotiated  before  the  6th  oi  THoA^k,  1007,  cif^d  request  you  to 
I  buy  them  at  the  rate  at  which  you  purchase  demand  drafts  on  London. 
1  The  amount  of  each  draft  must  be  inscribed  on  the  bach  of  this 

1    letter,  and  to  this  we  wish  to  call  your  special  attention.    This  letter 
g    itself  should  be  canceled  and  attached  to  the  final  draft  drawn. 
^  Please  see  to  it  that  the  drafts  be  signed  in  your  presence  and 

°    carefully  compare  the  signature  with  the  one  below. 
?  We  are.  Gentlemen 

<  Your  obedient  servants 

h 

£,500.  Buyn^H.  Bhot/i 


xeAA^ 


To  Messieurs  The  signature  of 

the  hankers  mentioned  n^^^   ^^   aAcyuvU. 

on  the  third  page  of  ' 

this  letter  of  credit. 


BANKING  93 

The  Reverse  or  Back  of  the  Letter  of  Credit 


Indorsements  once  made  hereon^  of  payments^  must  he  allowed  to  remain 

without  alteration  or  erasure.     Care  should  therefore  he  taken  to  under- 

stand exactly  about  payments  dt 

isired,  hefore  inscribing  amounts  helow. 

On  the  payment  of  any  sum  exhausting  this  credit,  this  letter  must  he  sur- 

rendered h^  the  holder  and  attached  hy  the  hanker  negotiating  the  draft  to 

the  said  draft. 

DATE  WHEN 
PAID 

BY  WHOM  PAID 

NAME  OF 
TOWN 

AMOUNT  STERLING 
WRITTEN  IN  WORDS 

AMOUNT  IN  FIGURES 

£ 

J. 

d. 

1906 

April 

2 

Union  Bank 

London 

Seventy-five  pounds 

75 

— 

— 

20 

Credit  Lyonnais 

Paris 

Twenty-five  pounds 

25 

— 

— 

May 

5 

Mendelssohn  &  Co. 

Berlin 

Ten  pounds 

10 

— 

— 

20 

Anglo- Austrian  Bank 

Vienna 

One  hundred  pounds 

100 

— 

— 

June 

5 

Banca  Commerciale  Italiana 

Rome 

One  hundred  pounds 

100 

— 

— 

July 

25 

Filiale  der  Dresdner  Bank 

Hamburg 

Ninety  pounds 

90 

— 

— 

Aug. 

15 

Brown  Brothers  &  Co. 

Boston 

One  hundred  pounds 

100 

— 

— 

500 

— 

— 

Note.  —  On  the  pages  following,  in  a  regular  letter  of  credit,  are  the  names  of 
towns  and  cities,  and  banks  therein,  any  one  of  which  will  advance  money  upon  the 
letter  of  credit.     The  list  includes  banks  in  all  parts  of  the  world. 

In  what  Funds  usually  drawn.  —  Letters  of  credit  are  usually  drawn 
payable  in  pounds  sterling ;  but  they  are  paid  in  the  current  money  of 
the  country  in  which  they  are  negotiated.  They  pass  everywhere  as 
cash,  since  any  banker  in  the  world  would  usually  be  very  willing  to 
buy  a  reliable  sterling  draft  on  London.  Thus  with  a  letter  of  credit 
a  traveler  can  make  a  trip  around  the  world  with  no  more  real  money 
on  his  person  than  is  necessary  to  meet  immediate  local  expenses. 

Commission  Charges.  —  The  cost  to  the  purchaser  for  a  letter  of  credit 
is  usually  about  1  %  of  the  amount  of  issue,  though  no  letter  will  be 
issued  for  less  than  $5. 


REVIEW  QUESTIONS 

1.  Briefly  outline  the  duties  of  the  discount  clerk.  2.  When  is  collection  and 
exchange  charged  on  paper  discounted?  3.  When  paper  is  accepted  for  discount, 
upon  what  book  is  it  first  entered?  4.  Explain  how  to  post  the  footings  of  the 
discount  register.     5.  Explain  the  purpose  and  use  of  the  discount  tickler.    6.  What 


94  BOOKKEEPING 

is  the  law  in  your  state  with  reference  to  notes,  etc.,  falling  due  on  Sunday  or  a 
legal  holiday?  7.  Briefly  outline  the  duties  of  the  collection  clerk.  8.  State  the 
sources  from  which  a  bank  receives  paper  for  collection.  9.  What  kind  of  sight 
paper  should  not  be  entered  in  the  collection  register?  Why?  10.  Explain  the 
purpose  and  use  of  the  collection  register ;  the  collection  tickler.  11.  Briefly  outline 
the  principal  duties  of  the  receiving  teller.  12.  In  examining  paper  deposited, 
what  are  the  things  that  should   be  particularly  noted  by  the  receiving  teller? 

13.  Should    paper   payable   to    "bearer"   be    indorsed    before    deposited?     AVhy? 

14.  Explain  a  method  of  classifying  items  on  the  deposit  ticket.  15.  On  what  class 
of  checks  does  a  bank  charge  collection?  16.  Explain  the  purpose  and  use  of  the 
receiving  teller's  daily  check  sheet.  17.  Explain  the  manner  of  proving  the  receiv- 
ing teller's  daily  check  sheet.  18.  Briefly  outline  the  principal  duties  of  the  paying 
teller.  19.  When  paper  is  presented  for  payment,  what  should  the  paying  teller 
examine  very  critically?  Why?  20.  Should  the  amount  expressed  in  figures  on 
any  given  check  differ  from  the  amount  expressed  in  writing,  which  amount  would 
the  paying  teller  be  justified  in  paying?  Why?  21.  What  is  a  certified  check? 
22.  Do  banks  ever  certify  checks  in  excess  of  a  depositor's  account  ?  23.  In  what 
particulars  is  a  check  stronger  after  certification  than  it  was  before?  In  what 
respects  is  it  the  same?  24.  What  is  the  purpose  of  a  certified  check  book? 
25.  Why  is  a  bank  draft  l^etter  than  a  check  for  making  payments  out  of  town? 
Explain  fully.  26.  Explain  fully  the  purx>ose  and  use  of  the  paying  teller's  daily 
check  sheet.  27.  Explain  the  manner  of  proving  the  paying  teller's  daily  check 
sheet.  28.  Briefly  outline  the  principal  duties  of  the  note  teller.  29.  When  are 
bills  discounted  that  have  been  sent  away  for  collection  charged  to  the  banks  to 
which   they  are    sent?     30.  For  what   purpose    are    notes,   drafts,  etc.,  certified? 

31.  In  your  state  are  notes,  etc.,  made  payable  at  a  bank  charged  to  the  depositor's 
account,  at  maturity,  or  is  it  usual  for  business  men  to  pay  this  paper  by  check? 

32.  When  is  a  note  or  other  negotiable  paper  protested  ?  33.  Explain  the  method 
of  protesting  paper.  34.  What  is  a  notice  of  protest?  35.  To  what  officer  are 
notary  fees  usually  paid?  36.  Briefly  outline  the  principal  duties  of  the  corre- 
spondence clerk.  37.  What  is  the  purpose  of  the  draft  register  ?  IIow  is  it  posted  ? 
38.  What  two  books  are  combined  in  the  remittance  register.  39.  Explain  fully 
the  purpose  and  use  of  the  remittance  register.  40.  IIow  is  the  remittance  register 
posted?  How  proved?  41.  Briefly  outline  the  principal  duties  of  the  individual 
bookkeeper.  42.  From  what  sources  does  the  individual  bookkeeper  get  his  items 
for  entry  in  the  individual  ledger  ?  43.  Explain  the  use  of  the  individual  ledger. 
44.  How  is  the  individual  ledger  proved  ?  45.  Explain  how  an  overdraft  is  treated 
in  the  individual  ledger.  46.  What  books  are  generally  kept  by  the  general  book- 
keeper? 47.  Explain  the  use  of  the  general  balance  ledger.  48.  Name  all  the 
sources  from  which  items  are  obtained  for  entry  in  the  general  cash  book.  49.  Define 
(a)  letter  of  credit ;  (b)  clearing  house  ;  (c)  dividends ;  (d)  surplus  fund.  50.  Give 
a  three-minute  talk  on  clearing-house  associations ;  on  letters  of  credit. 


APPENDIX  A 

NOTES  ON  FORMS  OF  RECORD 


Discount  Register.  —  The  column  headings  in  the  Discount  Register  may  vary 
slightly  in  ditferent  banks,  and,  in  addition  to  those  shown  in  the  text,  may  include 
the  time  or  tenor  of  the  paper.  Many  banks  carry  the  Liability  Ledger  also,  in  which 
is  recorded  against  the  name  of  each  customer  the  paper  on  which  that  customer's 
name  appears  as  maker  or  indorser. 

Collection  Tickler.  —  Since  collection  items  must  be  recorded  individually,  not 
in  totals  as  checks  are  recorded,  the  bookkeeping  incidental  to  collection  items 
requires  more  entries.  As  the  Collection  Register  or  the  Collection  Tickler  can  be 
handled  only  by  one  clerk  at  a  time,  many  banks  are  substituting  for  these  books  a 
carbon  system,  and  an  individual  record  in  duplicate  is  made  of  each  item,  on  slips 
of  convenient  size.  This  record  is  identical  with  that  contained  in  the  bound  regis- 
ters when  these  books  are  used. 

At  maturity  the  fate  of  each  piece  is  recorded  on  these  slips,  and  the  bookkeepers 
post  to  the  accounts  directly  from  them ;  the  slips  are  then  filed  away  as  a  perma- 
nent record. 

Receiving  Teller's  Daily  Check  Sheet.  —  That  part  of  the  bookkeeping  which  is 
done  by  the  receiving  teller  has  three  distinct  objects :  first,  to  prove  the  deposit 
ticket ;  second,  to  subdivide  the  checks  into  convenient  groups  for  a  final  settlement 
by  the  other  departments  of  the  bank  ;  third,  in  the  accomplishment  of  these  results, 
to  handle  the  checks  as  few  times  as  possible.  This  subdivision  is  best  accomplished 
by  the  block  or  batch  system.  Under  this  system  the  currency  is  verified  and  the 
indorsements  noted  by  the  teller,  but  the  addition  is  not  proved.  A  clerk  assorts 
the  checks  into  the  several  divisions  or  departments  of  the  bank  and  makes  a  total 
of  each  list  on  an  adding  machine ;  a  recapitulation  proves  the  amount  of  the 
ticket.  The  most  extended  division  is  made  of  those  checks  which  are  received  in 
the  greatest  number. 

Remittance  Register  and  Out-of-Town  Banks  Ledger. — Many  banks  omit  from 
this  register  the  columns  headed  Indorser,  Payer,  and  Where  Payable,  as  this  infor- 
mation, when  needed,  is  secured  from  the  book  or  record  of  original  entry. 

An  exact  copy  of  these  inter-bank  transactions  is  made  and  forwarded  monthly 
to  each  out-of-town  bank  correspondent.  This  form  of  statement  is  known  as  the 
account  current.  The  reconcilement  form,  the  form  or  statement  by  which  the  ac- 
counts of  one  bank  are  reconciled  with  those  of  another  bank  (see  illustration,  p.  97), 
is  the  form  used  by  the  Bank  Examiner. 

Letters  are  used  to  indicate  the  nature  of  certain  entries,  as  follows:  D  for 
drafts,  N  for  notes,  and  C  for  collections. 

As  a  means  of  avoiding  the  writing  of  names  many  times,  banks  have  devised 
what  is  termed  a  transit  number.  A  prefix  number  is  used  to  designate  a  certain  city 
or  state,  and  each  bank  is  also  given  a  certain  number.   For  instance,  the  Webster 

95 


96  BOOKKEEPING 

and  Arias  Bank,  of  Boston,  is  designated  as  5-25,  5  indicating  the  city,  and  25  the 
bank.    Banks  print  the  designated  number  on  all  their  checks. 

As  a  convenience  for  the  student  the  fuller  explanatory  terms  are  retained  in  the 
blanks  used  with  this  set. 

Individual  Ledger.  —  Many  different  systems  are  in  use  for  keeping  the  accounts 
of  the  depositors.  The  one  given  in  the  text  is  the  most  convenient  for  the  use  of 
the  student  in  the  classroom. 

The  loose-leaf  system  is  finding  a  place  in  many  banks.  Each  account  is  given  a 
separate  sheet,  and  as  a  sheet  is  filled,  the  balance  is  transferred  to  a  new  sheet,  and 
the  old  one  is  filed  away.  At  the  end  of  the  year  these  sheets  are  bound  and  consti- 
tute an  individual  ledger  for  the  year. 

The  loose-leaf  system  has  two  special  advantages,  namely,  the  dead  or  inactive 
accounts  are  easily  and  readily  set  aside  and  a  proof  is  quickly  made  at  the  end  of 
the  day  by  writing  the  balances  on  an  adding  machine. 

The  introduction  of  adding  and  duplicating  machines  has  greatly  enlarged  the 
use  of  loose-leaf  devices,  and  tends  to  lessen  the  labor  involved  in  handling  many 
details. 


BANKING 


97 


Reconcilement  Form 


The  First  National  Bank  of  Chicago,  111, 


In  Account  with. 


Potomac  National  Bank 


.,    Of. 


Baltimore 


(Please  write  the  Name  and  Address  here) 

To  H.  L.  Droegemueller,  Auditor 

First  National  Bank  

Chicago,  111. 


4/5 


19. 


.showing  balance 


Your  statement  of  account  rendered  to April  i 

of  $  25.422?^    Hne   us    has  been  examined  and  agrees  with  our  books  as  per  recon- 
cilement noted  below. 


^&a.  fi-.  ja^JcQxyn,  (ZiicLiZav 


(This  must  be  signed  by  some  one  whose  signature  we  have  on  file) 


28 
29 


14 


We  Debit  (not  in  your 
account) 

C.    Jones 


Our  Remittances   in 
Transit 


In  returning  this  Recon- 
cilement please  inclose, 
seal,  and    mail   only  in 
envelope    herewith    ad- 
dressed to 
H.  L.  Droegemueller, 
Auditor 


You  Debit  (not  on  our 
Books) 

(State  whether  since  Credited 
by  you) 


Ret 


1st  Chicago,  Balance 
Total 


25 


|28 


16 


120 
210 


220 


422 


989 


22 


16 

42 


16 


16 


12 


DATE 


22 


18 


We  Credit  (not 
in  your  account) 

Note     Smith 
C        Jones 


Total  Drafts 

Issued 
(Outstanding) 

#1622 
1623 


You  Credit  (not 
on  our  Books) 

(State  whether  since 
Debited  by  you) 


Our  Balance 

Total 


27 


$28 


400 
27 


124 
500 


224 


713 


989 


16 


10 


86 


12 


Correspondents  will  confer  a  favor  by  filling  up  and  returning  the  above  blank.  In  report- 
ing outstanding  items  be  particular  to  state  Bate  of  Charge  or  Credit  and  also  whether  since 
charged  or  credited  by  you.    In  referring  to  Remittances  please  advise  Date  of  letter. 


98  BOOKKEEPING 

Certificate  of  Protest 


Commontoealtf)  of  JHassacijusetts 

County  of  Suffolk 


City  of  Boston 

On  the  temtk  day  of  ^ae^vUf-e/v,  in  the  year  of  our  Lord  one 
thousand  nine  hundred  aA^cL  tw-dA>-&,  %t  li)-.  CI.  IV^tUeAy, 
Itiotarp  Pnblic,  duly  admitted  and  sworn,  and  practicing  in  said 
Commonwealth,  at  the  request  cf  L&iok  If.  JSuA^oxyyi,  Cfiiq., 
Ca£;|)ier  of  the  ^^yifviyLeA^ial  cAdtuyyiat  BamJo,  went  with  tJie 
original  not^',  which  is  hereunto  annexed,  the  time  therein 
limited  having  fully  elapsed,  and  demanded  payment  tliereof 
at  tk&  (^x^e&loAxyi/  cAatuyyiat  Ba/Kk/,  curuL  w<Kh  om/^^w-eA^t^L  (yu  tk& 

The     'Kot&     remaining  unpaid,  I  duly  and  officially  notified 

the  i/yhdavQ^eA^  tkeAy&oj^  at  Vv&  j^olLyiAhin/^  adcLv^Q^Q^e^  : 

B.  10^.  ffo^&yv  V  ^.,  c/lr&'wlcyyi,  Tf^aa^., 

{postage  prepaid)  of  said  cUJomCC  requiring  payment. 
W\itxtitiXt,  I,  the  said  i^otarp,  hy  request  as  aforesaid,  have  pro- 
tested and  hy  these  presents  do  solemnly  protest,  against  the 
drawer  of  said  ruote^,  the  indorscr,  and  all  others  concerned 
therein,  for  exchange,  re-exchange,  and  all  costs,  charges, 
damages,  and  interest,  suffered  and  sustained,  or  to  he 
suffered  and  sustained,  hy  reason  or  in  conse- 
quence of  the  non-payment  thereof. 

3fu   QTtflitiinonp   i^I)CrCOf,   /  have  hereunto  set  my  hand  and 
affixed  my  Notarial  Seal,  the  day  and  year  first  above  written. 


Noting  Non-Acceptatice  .    .    . 

Postage 

Protesting  for  Non-Payment    .  >ff,  oO 

Postage 0^  m.   CI.   WlUeV 


$/.^^  Botarj)  public 


APPENDIX  A 


99 


Notice  of  Protest 


Commercial  ^J\[ational  ^anJ^ 


Boston,  Mass.,      ^e^.  fO,      f^- 


^2  IV^&oZ  ^t.,  ^Ojif 


Dollars 
licyw,     dated 


Dear  Siro,: 

You  are  hereby  notified  that  a      ^yioto 
for     c4iyyi&   flfiim^dv&ci   cfi/xt/^  ■ 
drawn  hy  £&^&v,  B^injb  V-  ^. ,    cuni^  indorsed  hy 

Q^eyfst.  10,      19 ,  payable     thA^&&  mxyntk^     after  date,  has  been 

protested  by  me  for  non-payment  after  due  demand  at  tk& 
(ooc^&Imx^v  cAatuyyicil  fSamJo  this  day,  and  that  you  are  held 
answerable  for  the  amount,  with  all  legal  costs,  interests,  and 
damages  in  consequence  of  the  non-payment  thereof. 

Respectfully  yours 


APPENDIX  B 


COMMERCIAL   TERMS   DEFINED 


Acceptance.  The  name  of  an  accepted 
draft;  an  agreement,  by  signature, 
to  the  terms  named  in  the  draft. 

Account  Current.  An  open  or  a  running 
account;  a  detailed  statement  of 
transactions  between  two  persons 
or  two  firms. 

Account  Sales.  An  itemized  statement 
of  sales  and  expenses,  rendered  by 
a  commission  merchant  to  his  prin- 
cipal. 

Acknowledgment.  A  formal  admission, 
made  before  a  notary  or  other  quali- 
fied officer,  that  the  act  described 
was  done  voluntarily;  the  officer's 
certificate  of  such  admission. 

Affidavit.  A  written  statement  made 
under  oath. 

Agent.  One  who  acts  for,  or  in  place  of, 
another,  by  authority  from  him ;  a 
deputy. 

Assignee.  One  appointed  by  another  to 
do  some  act  or  to  enjoy  some  right ; 
generally,  one  to  whom  property  is 
transferred  for  the  benefit  of  the 
creditors. 

Attachment.  A  seizure  or  taking  into 
custody  by  virtue  of  a  legal  process. 

Auditor.  A  person  appointed  to  examine 
accounts. 

Bankrupt.  Any  person  whose  property 
becomes  liable  to  administration 
under  the  bankruptcy  laws. 

Bill  of  Lading.  A  receipt  of  a  transpor- 
tation company,  containing  an  ac- 
count of  the  goods  shipped  and  the 
conditions  of  shipment. 

Bill  of  Sale.  A  writing  given  by  the  seller 
of  personal  property  to  the  buyer. 


Board  of  Trade.  In  the  United  States, 
a  voluntary  organization  of  business 
men  for  the  advancement  of  com- 
mercial interests. 

Bona  Fide.    In  good  faith. 

Bond.  A  written  promise  under  seal, 
binding  a  person  to  do  a  certain 
thing  or  not  to  do  it. 

Bonus.  Something  given  in  addition  to 
what  is  strictly  due  the  recipient. 

Broker.  An  agent  between  buyer  and 
seller;  a  dealer  on  the  stock  ex- 
change. 

Capital.  The  investment  in  a  busi- 
ness. 

Cashier.  One  who  has  charge  of  money ; 
in  banks,  the  financial  officer. 

Certified  Check.  A  check  that  has  been 
accepted  by  the  bank  on  which  it  is 
drawn,  thereby  making  the  bank 
security  for  its  payment. 

Clearing  House.  An  institution  in  a  city 
where  daily  settlements  are  made 
between  banks  by  the  mutual  ex- 
change of  checks,  drafts,  etc.,  the 
difference  between  such  exchanges 
being  paid  in  cash. 

Collateral.  A  security  additional  to  the 
personal  obligation. 

Common  Carrier.  One  who  undertakes 
the  office  of  carrying  either  goods 
or  persons  for  hire. 

Copartnership.  The  voluntary  associa- 
tion or  joining  of  two  or  more  per- 
sons in  a  business  enterprise.  The 
same  as  partnership. 

Copyright.  A  right  of  control  granted 
by  a  government  to  an  author  or 
a  publisher. 


100 


APPENDIX   B 


■xn 


Coupon.  A  certificate  of  interest  due, 
printed  at  the  bottom  of  trans- 
ferable bonds,  designed  to  be  cut 
off  and  presented  for  payment  when 
the  interest  is  due. 

Credit  Memorandum.  A  notice  sent  to 
a  purchaser  stating  that  an  allow- 
ance has  been  made  for  goods  re- 
turned, or  for  other  causes. 

Deed.  A  contract  under  seal,  usually 
transferring  the  title  of  real  estate. 

Depreciation.    A  falfing  of  value. 

Dishonor.  A  refusal  to  pay  an  obliga- 
tion when  due,  or  to  accept  a  draft 
when  presented  for  acceptance. 

Dividend.  The  allotment  to  each  stock- 
holder in  the  division  of  profits. 

Drayage.  Charges  for  conveying  goods 
from  one  place  to  another. 

Exchange.  The  method  by  which  debts 
are  discharged  without  the  actual 
transference  of  money ;  the  rate  at 
which  such  exchange  can  be  made. 

Extension.  An  allowance  of  further 
time  for  the  payment  of  a  debt. 

Fixtures.  That  part  of  the  furnishings 
of  a  store  or  an  office  which  is  not 
movable. 

Footing.  The  adding  of  a  column  of  fig- 
ures, or  the  result  of  such  addition. 

Forgery.  The  writing  of  another's 
name,  as  a  signature,  with  fraudu- 
lent intent,  or  the  altering  of  a 
written  document. 

Franchise.  A  certain  right  or  privilege, 
granted  by  a  government  to  indi- 
viduals or  corporations. 

Freight.  Compensation  paid  for  the 
transport  of  goods  or  other  property ; 
that  with  which  anything  is  laden 
for  transportation. 

Good  Will.  The  value,  in  a  business,  of 
established  reputation  or  patronage. 

Guaranty.  An  agreement  by  which  one 
person  promises  to  make  another 
secure  in  the  possession  or  enjoy- 
ment of  something;  a  security 
against  loss. 


Honor.  To  accept  a  draft,  or  to  pay  it 
when  due. 

Income.  The  total  amount  of  the  earn- 
ings and  the  receipts  of  money  from 
all  sources. 

Index.   An  alphabetical  table  of  contents. 

Indorse.  To  write  one's  name  on  the 
back  of  a  note,  a  check,  or  a  draft ;  to 
record  a  partial  payment  on  the  back 
of  a  note. 

Installment.  A  sum  of  money  paid  in 
stated  portions. 

Insurance.  Indemnity  against  loss ;  the 
premium  paid  for  insuring. 

Jobber.  A  merchant  who  buys  goods 
from  importers  and  manufacturers, 
and  sells  to  either  wholesale  or  retail 
merchants. 

Liquidation.  Act  or  process  of  settling 
debts. 

Lease.  A  contract,  usually  in  writing, 
for  the  temporary  possession  of  real 
estate  or  other  property. 

Letter  of  Credit.  A  letter  usually  issued 
by  a  bank,  addressed  to  banks  in 
foreign  cities,  directing  payment  of 
a  stated  amount  to  the  holder. 
Such  letters  are  usually  carried  by 
travelers. 

Manifest.    An  invoice  of  a  ship's  cargo. 

Mercantile  Agency.  An  institution  which 
obtains  and  furnishes  information 
regarding  mercantile  enterprises, 
their  financial  standing,  their  busi- 
ness reputation,  etc. 

Money.  Current  coin;  any  circulating 
medium. 

Mortgage.  A  conditional  transfer  of  the 
title  to  real  estate  or  chattels  as 
security  for  the  payment  of  a  debt. 

Negotiate.  To  treat  with  another  with 
a  view  to  reaching  an  agreement; 
to  transfer  for  a  valuable  considera- 
tion. 

Net.    Clear  of  all  charges  or  deductions. 

Notary.  A  public  officer  who  takes  ac- 
knowledgments of  legal  documents 
and  protests  paper  for  nonpayment. 


A^^  ^ 


BOOKKEEPING 


Open  Account.  A  running  or  an  unsettled 
account. 

Open  Policy.  An  insurance  policy  cover- 
ing undefined  risks  and  admitting 
of  subsequent  indorsements  or  ad- 
ditions. 

Outstanding  Accounts.  Book  accounts 
remaining  unpaid. 

Overdrawn.  A  term  applied  to  a  bank 
account  when  a  check  has  been 
issued  for  an  amount  greater  than 
one's  credit  balance. 

Patent.  An  exclusive  right  to  an  inven- 
tion, issued  by  a  government. 

Pawnbroker.  One  who  makes  a  business 
of  lending  money  on  personal  prop- 
erty pledged  and  in  his  keeping. 

Power  of  Attorney.  A  legal  authority  to 
act  for  another. 

Premium.  The  consideration  paid  for  a 
contract  of  insurance;  a  sum  or 
bonus  in  addition  to  the  capital. 

Protest.  A  formal  notice,  issued  by  a 
notary  to  the  indorser  or  the  in- 
dorsers  of  a  note  or  draft,  of  the 
nonpayment  of  a  note  or  a  draft,  or 
the  nonacceptance  of  a  draft. 

Quotations.  The  published  or  current 
prices  of  stocks,  bonds,  or  any  com- 
modity. 

Rebate.  An  allowance  for  overcharge,  for 
early  payment,  or  for  other  reasons. 

Receiver.  A  person  appointed  by  the 
court  to  hold  in  trust  property  which 


is  the  subject  of  litigation,  pending 
the  suit;  or  one  who  is  appointed 
to  wind  up  the  affairs  of  a  partner- 
ship or  a  corporation  on  its  dissolu- 
tion. 

Retail.    To  sell  in  small  quantities. 

Short-extend.  To  enter  individual 
amounts  at  the  left  of  the  money 
column,  to  be  extended  in  total  in 
the  money  column. 

Sinking  Fund.  A  fund  set  apart  for  the 
redemption  of 'bonds  or  for  other 
specific  uses. 

Sundries.  Many  different  or  small  things. 

Syndicate.  A  combination  of  capitalists 
who  unite  their  resources  to  advance 
some  specific  business  enterprise. 

Tariff.    A  lawful  rate  of  duty  on  imports. 

Terms.  Conditions  of  sale  or  of  agree- 
ment. 

Tickler.  A  book  containing  memoranda 
of  all  time  paper,  and  arranged  so 
as  to  serve  for  a  reminder  to  pay  or 
to  collect. 

Trustee.  One  intrusted  with  property  for 
another. 

Underwriter.    One  who  insures. 

Valid.    Binding  in  law. 

Void.    Not  binding  in  law. 

Way  Bill.  A  document  containing  a  de- 
scription and  shipping  directions  of 
goods  sent  by  railroad. 

Wholesale.  Selling  large  quantities,  usu- 
ally in  unbroken  packages. 


INDEX 


PAGE 

Abstracts,  out-of-town  banks  ledger         81 
Auxiliary  books 

Customers'  bill  book 21 

Discount  ledger 21 

Dividend  book       14 

Installment  book 14" 

Minute  book 14 

Offering  book 21 

Stock  certificate  book 14 

Stock  ledger 14 

Stock  transfer  book 14 

Subscription  book 14 

Balance  ticket 88 

Bank,  definition  of 1 

Bank  accounting,  books  for     ....      14 
Banks 

Expenses  of 2 

Kinds  of 2 

Profits  of 2 

Utility  of 1 

Cash  book,  model  forms  of      ...    52,  53 

Cashier's  check 29 

Cashier's  receipt 90 

Certificate  of  deposit 28 

Certified  check 35 

Certified  check  book 36 

Charge  ticket 46 

Charging  notes 38 

Check  ticket 85 

Clearing  house 

Definition  of 82 

Exchanges  of 82 

Officers  of 82 

Origin  of 82 

Clearing-house  proof 87 

Collection  charges 25 

Collection  clerk 

Duties  of 25 

Work  for  .     .    .     22-26,  56,  57,  67,  68 
Collection  register 

Description  of 21,  22 

Model  form  of 20,  21 

Collection  tickler 

Description  of 22 

Model  form  of 22,  23 

Correspondence  clerk 

Duties  of 40 

Work  for 41-46,  59-64, 

71-75 

Credit  exchange 86 

Credit  ticket 40,  85 


PAGE 

Debit  exchange 88 

Deposit  ticket 30 

Discount  clerk 

Duties  of 15 

Work  for  .    .    .     16-21,  55,  56,  66,  67 

Discount  register 

Description  of 15 

Model  form  of 16,  17 

Discount  tickler 

Description  of 15,  16 

Model  form  of 16,  17 

Dividends 77,  80 

Draft  register 43 

Exchange  slip 83 

General  balance  ledger 

Description  of 51 

Model  form  of 51 

General  bookkeeper 

Duties  of 52 

Work  for  ....        52-55,  66,  76-81 

Individual  bookkeeper 

Duties  of 48 

Work  for  .    .    .     48-50,  65,  66,  75,  76 

Individual  ledger 

Description  of 46,  47 

Model  form  of 47 

Letters 

Accompanying  paper  remitted  for 

collection  and  credit      ...      61 
Accompanying  paper  remitted  for 

collection  and  returns   ...      64 
Advising  that  collections  have  been 

credited 39 

Advising  remittance  of  cash  items 

for  credit 42 

Making  remittance 74 

Letters  of  credit 

Description  of 91-93 

Model  form  of 92,  93 

Manager's  receipt 89 

National  banks 

Capital  stock  of 3 

Circulating  notes  of 5 

Clerks  of 7 

Corporate  powers  of 6 

Distinguishing  features  of    .    ,    .        2 

Officers  of 7 

Organization  of 3 

Redemption  fund  of 6 

Restrictions  upon 6 

Tax  on  circulation  of 6 

103 


104 


BOOKKEEPING 


PAGE 

Note  teller 

Duties  of 37 

Work  for  .    .    .     38,  39,  50,  60,  70,  71 

Opening  entries  for  national  banks        8,  9 

Paying  teller 

Duties  of 35 

Work  for  ...     36,  37,  58,  59,  69,  70 

Paying  teller's  daily  check  sheet  and 
proof 

Description  of 31,  34 

Model  form  of 32,  33 

Private  banks 

Functions  of 12 

Organization  of 12 

Protection  to  creditors  of     ...      12 

Protest 

Certificate  of 98 

Fees 76 

Notice  of 99 

Protested  paper 70,  76 

Receiving  teller 

Duties  of 28 

Work  for  ...     30,  31,  67,  58,  68,  69 


PAGE 

Receiving  teller's  daily  check  sheet  and 
proof 

Description  of 28 

Model  form  of 27 

Reconcilement,  form  of 97 

Remittance    register    and    out-of-town 
banks  ledger 

Description  of 40,  41 

Model  form  of 10,  41 

Review  questions 12 

Runners 38 

Settling  clerk's  statement 84 

Special  agents 44 

State  banks 

Compared  with  national  banks    .      11 
Contrasted  with  national  banks  .      11 

Organization  of 11 

Statements,  model  forms  of     .    .    .    78,  79 

Surplus  fund 77,  80 

Trust  companies 

Business  of    ... 10 

Organization  of 10 

Undivided  profits 80 


UNIVERSITY  OF  CALIFORNIA  "  t,-„^^ 


Jl 


THIS  BOOK  IS  DUE  ON  THE  LAST  DATE 
STAMPED  BELOW 

AN  INITIAL  FINE  OF  25  CENTS 

WILL   BE  ASSESSED    FOR   FAILURE  TO    RETURN 
THIS   BOOK   ON   THE  DATE   DUE.   THE   PENALTY 
WILL  INCREASE  TO  SO  CENTS  ON  THE  FOURTH 
DAY    AND    TO     $1.00    ON     THE    SEVENTH     DAY 
OVERDUE. 

SEP  12  »y^^ 

SEP  131935 

,,   MAR  21-^^'^' 

LD  21-100m-7,'33 

YC  24012 


321^2 


y 


L 


UNIVERSITY  OF  CALIFORNIA  LIBRARY 


L 


